S257: 2025 Appropriations Act. Latest Version

Session: 2025 - 2026

Senate
Passed 1st Reading
Rules
Committee
Passed 3rd Reading


AN ACT TO MAKE BASE BUDGET APPROPRIATIONS FOR CURRENT OPERATIONS OF STATE AGENCIES, DEPARTMENTS, AND INSTITUTIONS.



The General Assembly of North Carolina enacts:



 



PART I. TITLE AND INTRODUCTION



 



TITLE OF ACT



SECTION 1.1.  This act shall be known as the Current Operations Appropriations Act of 2025.



 



Introduction



SECTION 1.2.  The appropriations made in this act are for maximum amounts necessary to provide the services and accomplish the purposes described in the budget in accordance with the State Budget Act. Savings shall be effected where the total amounts appropriated are not required to perform these services and accomplish these purposes, and the savings shall revert to the appropriate fund at the end of each fiscal year, except as otherwise provided by law.



 



PART II. CURRENT OPERATIONS AND EXPANSION/GENERAL FUND



 



General Fund Appropriations



SECTION 2.1.(a)  Appropriations from the General Fund for the budgets of the State departments, institutions, and agencies, and for other purposes, as enumerated, are made for each year of the 2025‑2027 fiscal biennium, according to the following schedule:



 



Current Operations - General Fund                                    FY 2025‑2026         FY 2026‑2027



 



EDUCATION



North Carolina Community College System



      Requirements                                                                     2,181,902,384          2,131,628,971



      Less: Receipts                                                                       400,787,849             398,313,878



      Net Appropriation                                                           1,781,114,535          1,733,315,093



 



Department of Public Instruction



      Requirements                                                                   15,043,864,593        15,140,028,934



      Less: Receipts                                                                    2,979,142,635          2,773,998,833



      Net Appropriation                                                         12,064,721,958        12,366,030,101



 



THE UNIVERSITY OF NORTH CAROLINA



East Carolina Univ. - Academic Affairs



      Requirements                                                                        449,746,645             450,746,645



      Less: Receipts                                                                       175,618,884             176,618,884



      Net Appropriation                                                              274,127,761             274,127,761



 



East Carolina Univ. - Health Affairs



      Requirements                                                                        121,853,241             121,853,241



      Less: Receipts                                                                         14,708,326               14,708,326



      Net Appropriation                                                              107,144,915             107,144,915



 



Appalachian State University



      Requirements                                                                        361,221,568             362,221,568



      Less: Receipts                                                                       151,358,973             152,358,973



      Net Appropriation                                                              209,862,595             209,862,595



 



Elizabeth City State University



      Requirements                                                                          57,575,597               58,575,597



      Less: Receipts                                                                           9,062,050               10,062,050



      Net Appropriation                                                                48,513,547               48,513,547



 



Fayetteville State University



      Requirements                                                                        108,137,643             109,137,643



      Less: Receipts                                                                         20,550,653               21,550,653



      Net Appropriation                                                                87,586,990               87,586,990



 



NC A&T University



      Requirements                                                                        265,794,998             277,409,534



      Less: Receipts                                                                       103,066,524             104,066,524



      Net Appropriation                                                              162,728,474             173,343,010



 



NC School of Science and Mathematics



      Requirements                                                                          49,107,483               49,107,483



      Less: Receipts                                                                           3,866,717                 3,866,717



      Net Appropriation                                                                45,240,766               45,240,766



 



NC State University - Academic Affairs



      Requirements                                                                     1,069,920,970          1,077,384,903



      Less: Receipts                                                                       500,608,834             507,708,834



      Net Appropriation                                                              569,312,136             569,676,069



 



NC State University - Ag. Research



      Requirements                                                                          83,589,800               83,589,800



      Less: Receipts                                                                         20,124,784               20,124,784



      Net Appropriation                                                                63,465,016               63,465,016



 



NC State University - Coop. Extension



      Requirements                                                                          65,417,787               65,417,787



      Less: Receipts                                                                         18,874,550               18,874,550



      Net Appropriation                                                                46,543,237               46,543,237



 



North Carolina Central University



      Requirements                                                                        155,704,790             156,704,790



      Less: Receipts                                                                         57,132,154               58,132,154



      Net Appropriation                                                                98,572,636               98,572,636



 



UNC at Asheville



      Requirements                                                                          75,136,418               76,136,418



      Less: Receipts                                                                         24,035,324               25,035,324



      Net Appropriation                                                                51,101,094               51,101,094



 



UNC at Chapel Hill - Academic Affairs



      Requirements                                                                        826,242,482             830,892,482



      Less: Receipts                                                                       428,694,558             434,794,558



      Net Appropriation                                                              397,547,924             396,097,924



 



UNC at Chapel Hill - Area Health Ed.



      Requirements                                                                          56,855,450               56,855,450



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                56,855,450               56,855,450



 



UNC at Chapel Hill - Health Affairs



      Requirements                                                                        392,135,573             392,135,573



      Less: Receipts                                                                       142,736,020             142,736,020



      Net Appropriation                                                              249,399,553             249,399,553



 



UNC at Charlotte



      Requirements                                                                        528,539,845             529,539,845



      Less: Receipts                                                                       194,855,102             195,855,102



      Net Appropriation                                                              333,684,743             333,684,743



 



UNC at Greensboro



      Requirements                                                                        309,910,059             310,910,059



      Less: Receipts                                                                       104,922,976             105,922,976



      Net Appropriation                                                              204,987,083             204,987,083



 



UNC at Pembroke



      Requirements                                                                        116,988,721             117,988,721



      Less: Receipts                                                                         21,514,868               22,514,868



      Net Appropriation                                                                95,473,853               95,473,853



 



UNC at Wilmington



      Requirements                                                                        352,177,159             353,177,159



      Less: Receipts                                                                       134,937,430             135,937,430



      Net Appropriation                                                              217,239,729             217,239,729



 



UNC BOG - Aid to Private Institutions



      Requirements                                                                            3,209,300                 3,209,300



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                  3,209,300                 3,209,300



 



UNC BOG - Institutional Programs



      Requirements                                                                     1,041,871,791             302,391,251



      Less: Receipts                                                                       751,500,000               46,300,000



      Net Appropriation                                                              290,371,791             256,091,251



 



UNC BOG - Related Ed. Programs



      Requirements                                                                     1,050,059,078          1,106,414,078



      Less: Receipts                                                                       188,962,939             188,962,939



      Net Appropriation                                                              861,096,139             917,451,139



 



UNC School of the Arts



      Requirements                                                                          58,876,330               58,876,330



      Less: Receipts                                                                         16,904,167               16,904,167



      Net Appropriation                                                                41,972,163               41,972,163



 



UNC System Office



      Requirements                                                                          45,207,311               45,207,311



      Less: Receipts                                                                           4,009,217                 4,009,217



      Net Appropriation                                                                41,198,094               41,198,094



 



Western Carolina University



      Requirements                                                                        202,007,511             202,241,223



      Less: Receipts                                                                         36,651,773               37,651,773



      Net Appropriation                                                              165,355,738             164,589,450



 



Winston-Salem State University



      Requirements                                                                          95,443,876               96,443,876



      Less: Receipts                                                                         26,700,103               27,700,103



      Net Appropriation                                                                68,743,773               68,743,773



 



HEALTH AND HUMAN SERVICES



Aging



      Requirements                                                                        162,915,759             162,947,825



      Less: Receipts                                                                       110,495,226             110,495,226



      Net Appropriation                                                                52,420,533               52,452,599



 



Central Management and Support



      Requirements                                                                        412,128,436             422,383,440



      Less: Receipts                                                                       172,006,912             172,356,352



      Net Appropriation                                                              240,121,524             250,027,088



 



Child and Family Well-Being



      Requirements                                                                        587,633,116             587,926,022



      Less: Receipts                                                                       529,771,915             529,771,915



      Net Appropriation                                                                57,861,201               58,154,107



 



Child Development and Early Education



      Requirements                                                                        990,933,974             981,756,397



      Less: Receipts                                                                       663,936,608             654,236,609



      Net Appropriation                                                              326,997,366             327,519,788



 



Emp. & Indep. For People with Disabilities



      Requirements                                                                        192,301,284             191,621,377



      Less: Receipts                                                                       148,446,353             147,558,152



      Net Appropriation                                                                43,854,931               44,063,225



 



Health Benefits



      Requirements                                                                   32,538,608,621        33,500,012,200



      Less: Receipts                                                                  26,083,787,689        26,693,039,769



      Net Appropriation                                                           6,454,820,932          6,806,972,431



 



Health Service Regulation



      Requirements                                                                          81,712,464               80,480,845



      Less: Receipts                                                                         57,846,866               57,854,112



      Net Appropriation                                                                23,865,598               22,626,733



 



Mental Hlth/Dev. Disabl./Subs. Use Serv.



      Requirements                                                                     1,763,591,519          1,770,189,290



      Less: Receipts                                                                    1,004,406,871          1,020,145,036



      Net Appropriation                                                              759,184,648             750,044,254



 



Public Health



      Requirements                                                                        508,520,689             508,811,732



      Less: Receipts                                                                       375,415,934             375,388,628



      Net Appropriation                                                              133,104,755             133,423,104



 



Services for the Blind/Deaf/Hard of Hearing



      Requirements                                                                          47,580,652               47,633,300



      Less: Receipts                                                                         38,277,639               38,286,064



      Net Appropriation                                                                  9,303,013                 9,347,236



 



Social Services



      Requirements                                                                     2,234,496,236          2,247,290,611



      Less: Receipts                                                                    2,012,293,694          2,016,966,010



      Net Appropriation                                                              222,202,542             230,324,601



 



AGRIC., NATURAL, AND ECON. RES.



Agriculture and Consumer Services



      Requirements                                                                        525,545,847             296,580,098



      Less: Receipts                                                                       343,305,058               93,169,654



      Net Appropriation                                                              182,240,789             203,410,444



 



Commerce



      Requirements                                                                        289,341,642             284,250,285



      Less: Receipts                                                                         82,602,791               77,352,791



      Net Appropriation                                                              206,738,851             206,897,494



 



Environmental Quality



      Requirements                                                                        243,160,102             273,198,525



      Less: Receipts                                                                       138,827,684             138,830,789



      Net Appropriation                                                              104,332,418             134,367,736



 



Labor



      Requirements                                                                          45,703,742               45,920,338



      Less: Receipts                                                                         19,106,870               19,106,870



      Net Appropriation                                                                26,596,872               26,813,468



 



Natural and Cultural Resources



      Requirements                                                                        359,359,497             359,371,744



      Less: Receipts                                                                         50,443,601               50,443,601



      Net Appropriation                                                              308,915,896             308,928,143



 



Wildlife Resources Commission



      Requirements                                                                        110,965,764             111,103,998



      Less: Receipts                                                                         86,200,340               86,200,340



      Net Appropriation                                                                24,765,424               24,903,658



 



JUSTICE AND PUBLIC SAFETY



Administrative Office of the Courts



      Requirements                                                                        841,032,377             845,093,406



      Less: Receipts                                                                           7,209,807                 1,209,807



      Net Appropriation                                                              833,822,570             843,883,599



 



Indigent Defense Services



      Requirements                                                                        194,782,744             190,741,412



      Less: Receipts                                                                         13,994,851               13,994,851



      Net Appropriation                                                              180,787,893             176,746,561



 



Adult Correction



      Requirements                                                                     2,150,041,042          2,165,757,470



      Less: Receipts                                                                         21,455,170               21,455,170



      Net Appropriation                                                           2,128,585,872          2,144,302,300



 



Justice



      Requirements                                                                        118,187,493             118,723,609



      Less: Receipts                                                                         50,114,998               50,114,998



      Net Appropriation                                                                68,072,495               68,608,611



 



Public Safety



      Requirements                                                                        897,114,592             887,268,176



      Less: Receipts                                                                       205,113,467             199,369,487



      Net Appropriation                                                              692,001,125             687,898,689



 



State Bureau of Investigation



      Requirements                                                                        190,854,950             188,623,418



      Less: Receipts                                                                         61,047,030               58,596,352



      Net Appropriation                                                              129,807,920             130,027,066



 



GENERAL GOVERNMENT



Administration



      Requirements                                                                          88,167,193               87,838,417



      Less: Receipts                                                                         15,562,661               15,446,340



      Net Appropriation                                                                72,604,532               72,392,077



 



Administrative Hearings



      Requirements                                                                          11,173,220               10,336,590



      Less: Receipts                                                                           4,021,520                 1,521,520



      Net Appropriation                                                                  7,151,700                 8,815,070



 



Auditor



      Requirements                                                                          52,895,549               58,027,963



      Less: Receipts                                                                         12,365,869               12,365,869



      Net Appropriation                                                                40,529,680               45,662,094



 



Budget and Management



      Requirements                                                                          12,820,660               12,897,248



      Less: Receipts                                                                           1,001,597                 1,001,597



      Net Appropriation                                                                11,819,063               11,895,651



 



Budget and Management - Special Approp.



      Requirements                                                                          19,300,000               16,850,000



      Less: Receipts                                                                           1,500,000                 1,500,000



      Net Appropriation                                                                17,800,000               15,350,000



 



Controller



      Requirements                                                                          38,051,149               38,256,937



      Less: Receipts                                                                           1,723,209                 1,723,209



      Net Appropriation                                                                36,327,940               36,533,728



 



Elections



      Requirements                                                                          22,552,422                 9,616,261



      Less: Receipts                                                                         13,102,000                    102,000



      Net Appropriation                                                                  9,450,422                 9,514,261



 



General Assembly



      Requirements                                                                        103,524,571             104,137,558



      Less: Receipts                                                                              767,526                    561,000



      Net Appropriation                                                              102,757,045             103,576,558



 



Governor



      Requirements                                                                          13,011,177               13,058,659



      Less: Receipts                                                                           6,140,294                 6,140,294



      Net Appropriation                                                                  6,870,883                 6,918,365



 



Housing Finance Agency



      Requirements                                                                          10,660,327               10,660,327



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                10,660,327               10,660,327



 



Human Resources



      Requirements                                                                          13,188,953               14,798,429



      Less: Receipts                                                                           1,273,415                    798,888



      Net Appropriation                                                                11,915,538               13,999,541



 



Industrial Commission



      Requirements                                                                          20,132,947               19,029,196



      Less: Receipts                                                                           9,989,699                 8,789,699



      Net Appropriation                                                                10,143,248               10,239,497



 



Insurance



      Requirements                                                                          52,604,785               53,043,086



      Less: Receipts                                                                           9,252,247                 9,358,231



      Net Appropriation                                                                43,352,538               43,684,855



 



Insurance - Fire Marshal



      Requirements                                                                          52,019,251               46,000,277



      Less: Receipts                                                                         12,118,899               14,023,004



      Net Appropriation                                                                39,900,352               31,977,273



 



Lieutenant Governor



      Requirements                                                                            1,477,791                 1,393,177



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                  1,477,791                 1,393,177



 



Military and Veterans Affairs



      Requirements                                                                            9,226,613                 9,363,639



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                  9,226,613                 9,363,639



 



Revenue



      Requirements                                                                        210,260,575             210,049,000



      Less: Receipts                                                                         78,596,148               75,777,870



      Net Appropriation                                                              131,664,427             134,271,130



 



Secretary of State



      Requirements                                                                          20,510,492               22,626,170



      Less: Receipts                                                                              862,750                 2,563,750



      Net Appropriation                                                                19,647,742               20,062,420



 



Treasurer



      Requirements                                                                        133,169,485             124,912,660



      Less: Receipts                                                                       107,960,411               96,853,586



      Net Appropriation                                                                25,209,074               28,059,074



 



Treasurer - Other Retirement Plans/Benefits



      Requirements                                                                          25,655,407               26,005,407



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                25,655,407               26,005,407



 



INFORMATION TECHNOLOGY



Department of Information Technology



      Requirements                                                                          91,107,354               91,281,100



      Less: Receipts                                                                              957,692                    957,692



      Net Appropriation                                                                90,149,662               90,323,408



 



RESERVES AND LOTTERY



General Fund Reserve



      Requirements                                                                          15,918,756               27,005,183



      Less: Receipts                                                                                         0                               0



      Net Appropriation                                                                15,918,756               27,005,183



 



      Total Requirements                                                       71,672,439,622        71,794,798,774



      Less: Total Receipts                                                       39,084,630,721        38,473,836,769



      Total Net Appropriation                                               32,587,808,901        33,320,962,005



 



SECTION 2.1.(b)  For purposes of this act and the Committee Report described in Section 45.2 of this act, the requirements set forth in this section represent the total amount of funds, including agency receipts, appropriated to an agency, department, or institution.



 



GENERAL FUND AVAILABILITY



SECTION 2.2.(a)  General Fund Availability. – The General Fund availability derived from State tax revenue, nontax revenue, and other adjustments used in developing the budget for each year of the 2025‑2027 fiscal biennium is as follows:



 



                                                                                                  FY 2025‑2026         FY 2026‑2027



Unappropriated Balance Remaining FY 2024-25                   48,073,341             988,429,749



      Anticipated Reversions                                                         500,000,000             500,000,000



      Anticipated FY 2024-25 Overcollections                             543,900,000                                -



Total, Prior Year-End Fund Balance                                  1,091,973,341          1,488,429,749



 



Consensus Revenue Forecast



      Tax Revenue                                                                    33,388,800,000        32,657,100,000



      Non-Tax Revenue                                                              1,500,900,000          1,410,000,000



Total, Tax & Non-Tax Revenue                                         34,889,700,000        34,067,100,000



 



Revenue Changes



      Adjustments to Tax Revenue                                              (119,235,000)            (99,493,000)



      Adjustments to Non-Tax Revenue                                         14,825,376               28,648,801



Total, Revenue Changes                                                         (104,409,624)            (70,844,199)



 



Statutorily Required Reservations of Revenue



      Savings Reserve                                                                    (44,799,750)                              -



      State Capital and Infrastructure Fund (SCIF)                  (1,120,000,000)       (1,159,200,000)



Total, Statutorily Required Reservations of Rev.             (1,164,799,750)       (1,159,200,000)



 



Discretionary Reservations of Revenue



      Additional Transfer to Savings Reserve                          (1,095,349,136)                              -



      Economic Development Reserve                                          (40,876,181)              (4,523,545)



Total, Discretionary Reservations of Rev.                         (1,136,225,317)              (4,523,545)



 



Revised Total General Fund Availability                          33,576,238,650        34,320,962,005



 



Total, Net General Fund Appropriations                          32,587,808,901        33,320,962,005



 



Unappropriated Balance                                                          988,429,749          1,000,000,000



 



SECTION 2.2.(b)  Savings Reserve. – Notwithstanding G.S. 143C‑4‑2, the State Controller shall transfer to the Savings Reserve the sum of one billion one hundred forty million one hundred forty-eight thousand eight hundred eighty-six dollars ($1,140,148,886) in nonrecurring funds in the 2025‑2026 fiscal year.



SECTION 2.2.(c)  IT Reserve. – The State Controller shall reserve to the Information Technology Reserve established in Section 2.2(h) of S.L. 2021‑180 from the Stabilization and Inflation Reserve established in Section 2.2(q) of S.L. 2022-74 the sum of one million dollars ($1,000,000) in nonrecurring funds for the 2025‑2026 fiscal year. The State Controller shall transfer funds available in the Information Technology Reserve to State agencies and departments for information technology projects in accordance with the following schedule:



 



State Agency or Department                                        2025‑2026                 2026‑2027



 



(1)        Department of Environmental Quality



(Budget Code: 24317)                                                   $10,510,000                             $0



(2)        Department of Public Instruction



(Budget Code: 23515)                                                     45,000,000                               0



(3)        Department of Administration



            (Budget Code: 74100)                                                       6,000,000                               0



(4)        Department of Revenue



            (Budget Code: 13410)                                                       4,367,667                 1,443,333



(5)        Department of State Treasurer



            (Budget Code: 14700)                                                       5,560,000                               0



(6)        Office of Administrative Hearings



(Budget Code: 18210)                                                       2,500,000                               0



(7)        Office of State Human Resources



(Budget Code: 14111)                                                       1,172,527                    698,000



(8)        State Board of Elections



            (Budget Code: 18025)                                                     13,000,000                               0



(9)        Office of State Budget and Management



            (Budget Code: 23017)                                                     20,850,000                    850,000



(10)      Office of State Auditor



            (Budget Code: 13300)                                                       5,000,000                 5,000,000



(11)      Division of Central Management and Support



            (Budget Code: 14410)                                                     15,118,177                               0



(12)      Division of Health Benefits



            (Budget Code: 14445)                                                       4,560,000                 9,100,000



(13)      Department of Public Safety



            (Budget Code: 14550)                                                       5,743,980                               0



(14)      State Bureau of Investigation



            (Budget Code: 15020)                                                       2,555,250                               0



(15)      Department of Information Technology



            (Budget Code: 14460)                                                          481,770                    481,770



(16)      Administrative Office of the Courts                                                                                       (Budget Code 12000)                                                                                  6,000,000                               0



 



SECTION 2.2.(d)  Federal Infrastructure Match Reserve. –The State Controller shall transfer funds available in the Federal Infrastructure Match Reserve established in Section 2.2(m) of S.L. 2022-74 to State agencies and departments in accordance with the following schedule:



 



State Agency or Department                                        2025‑2026                 2026‑2027



 



(1)        Department of Environmental Quality



            (Budget Code: 64311)                                                     $8,892,000               $8,892,000



(2)        Department of Environmental Quality



            (Budget Code: 64320)                                                     13,722,200                               0



(3)        Department of Environmental Quality



            (Budget Code: 24300)                                                       1,388,921                               0



(4)        Department of Environmental Quality



            Budget Code: 14300)                                                           850,000                    850,000



(5)        Department of Commerce



            (Budget Code: 14600)                                                          250,000                               0



 



SECTION 2.2.(e)  Stabilization and Inflation Reserve. – The State Controller shall transfer funds available in the Stabilization and Inflation Reserve established in Section 2.2(q) of S.L. 2022-74 to State agencies and departments in accordance with the following schedule:



 



State Agency or Department                                        2025‑2026                 2026‑2027



 



(1)        State Bureau of Investigation



            (Budget Code: 15020)                                                   $35,000,000             $35,000,000



(2)        Department of Agriculture



            (Budget Code: 13700)                                                   250,000,000                               0



(3)        Department of Environmental Quality



            (Budget Code: 24327)                                                     55,000,000               55,000,000



(4)        UNC at Chapel Hill – Academic Affairs



            Budget Code: 16020)                                                        3,000,000                 3,000,000



(5)        Department of Public Instruction



            (Budget Code: 13510)                                                   152,303,525             152,303,525



 



SECTION 2.2.(f)  Economic Development Project Reserve. – The State Controller shall reserve from funds available in the General Fund to the Economic Development Project Reserve established in Section 2.2 of S.L. 2021‑180 the sum of forty million eight hundred seventy-six thousand one hundred eighty-one dollars ($40,876,181) for the 2025‑2026 fiscal year and the sum of four million five hundred twenty-three thousand five hundred forty-five dollars ($4,523,545) for the 2026‑2027 fiscal year. Additionally, the Controller shall reserve the sum of two hundred fifty-eight million three hundred ninety-two thousand nine hundred fifty dollars ($258,392,950) in the 2025-2026 fiscal year from the Stabilization and Inflation Reserve established in Section 2.2.(q) S.L. 2022-74 and the sum of fifteen million three hundred sixty-one thousand twenty-one dollars ($15,361,021) in the 2025-2026 fiscal year from the Information Technology Reserve established in Section 2.2(h) of S.L. 2021-180.



SECTION 2.2.(g)  Helene Reserve. – The State Controller shall reserve to the Hurricane Helene Disaster Recovery Fund (Helene Fund) established in Section 4.1 in S.L. 2024-51 funds transferred from the following for the 2025-2026 fiscal year:



 



Source                                                                             2025-2026



 



(1)        State Emergency Response and



            Disaster Relief Fund                                                   $116,716,887



 



(2)        Federal Infrastructure Match Reserve                             45,469,983



 



(3)        Medicaid Contingency Reserve                                    476,512,736



 



(4)        Information Technology Reserve                                   61,300,394



 



The State Controller shall transfer funds available in the Helene Fund to State agencies and departments in accordance with the following schedule:



 



State Agency or Department                                        2025‑2026                 2026‑2027



 



(1)        NC Community College System



            (Budget Code: 16800)                                                     $2,473,971                             $0



(2)        Department of Commerce



            (Budget Code: 14600)                                                       5,000,000                               0



(3)        Office of the Governor



            (Budget Code: 13000)                                                       5,000,000                 5,000,000



(4)        University of North Carolina – Board of Governors



            Institutional Programs



            (Budget Code: 16011)                                                       8,000,000                               0



 



SECTION 2.2.(h)  Reservations Not Appropriation. – Funds reserved pursuant to this section do not constitute an appropriation made by law, as that phrase is used in Section 7(1) of Article V of the North Carolina Constitution.



 



PART III. HIGHWAY FUND AND HIGHWAY TRUST FUND



 



Current operations and expansion/highway fund



SECTION 3.1.  Appropriations from the State Highway Fund for the maintenance and operation of the Department of Transportation and for other purposes, as enumerated, are made for each year of the 2025‑2027 fiscal biennium, according to the following schedule:



 



Highway Fund                                                                          FY 2025‑26             FY 2026‑27



Administration                                                                          $125,175,472           $125,175,472



Division of Highways



      Administration                                                                        55,675,557               55,675,557



      Construction                                                                           89,643,078               82,643,078



      Maintenance                                                                      2,405,175,949          2,319,193,319



      Governor's Highway Safety Program                                          351,695                    351,695



      OSHA                                                                                          358,030                    358,030



Aid to Municipalities



      Powell Bill                                                                            135,875,000             135,875,000



Intermodal Divisions



            Ferry                                                                                 78,841,173               87,957,728



            Public Transportation                                                       69,570,554               71,570,554



            Aviation                                                                          192,320,982             173,146,238



            Rail                                                                                   24,367,607               24,367,607



Division of Motor Vehicles                                                        159,082,029             159,120,209



Other State Agencies, Reserves, Transfers                                   51,226,553               60,772,240



Capital Improvements                                                                  10,797,739               47,793,273



Highway Fund Total                                                              $3,398,461,418        $3,344,000,000



 



Highway Fund Availability



SECTION 3.2.  The Highway Fund availability used in developing the budget for each year of the 2025‑2027 fiscal biennium is as follows:



 



                                                                                                  FY 2025‑2026         FY 2026‑2027



Beginning Balance                                                                                    $0                             $0



 



Consensus Revenue Forecast



Motor Fuels Tax                                                                      1,866,100,000          1,891,500,000



Licenses and Fees                                                                    1,097,500,000          1,116,000,000



Sales Tax Transfer                                                                      171,500,000             176,900,000



Short‑Term Lease                                                                       113,100,000             114,900,000



Investment Income                                                                       50,200,000               37,600,000



Transportation Commerce Tax                                                       7,000,000                 7,300,000



 



Adjustments to Availability



DMV IT Modernization Carry Forward Cash Balance                65,000,000                               0



Remaining Dorian Appropriation                                                 28,161,418                               0



Sales Tax Net of Trade                                                                     (100,000)                 (200,000)



 



Total Highway Fund Availability                                      $3,398,461,418        $3,344,000,000



 



Highway Trust Fund Appropriations



SECTION 3.3.  Appropriations from the State Highway Trust Fund for construction, for operations of the Department of Transportation, and for other purposes as enumerated are made for each year of the 2025‑2027 fiscal biennium according to the following schedule:



 



Highway Trust Fund                                                                FY 2025‑26             FY 2026‑27



Program Administration                                                             $66,117,311             $45,117,311



Bond                                                                                            121,440,275             121,436,275



Turnpike Authority                                                                       49,000,000               49,000,000



State Ports Authority                                                                    45,000,000               45,000,000



FHWA State Match                                                                        6,048,440                 6,048,440



Strategic Prioritization Funding



      Plan for Transportation Investments                                 2,200,053,974          2,279,257,974



Transfer to Visitor Center                                                                  640,000                    640,000



Highway Trust Fund Total                                                 $2,488,300,000        $2,546,500,000



 



Highway Trust Fund Availability



SECTION 3.4.  The Highway Trust Fund availability used in developing the budget for each year of the 2025‑2027 fiscal biennial budget is as follows:



 



FY 2025‑2026           FY 2026‑2027



Beginning Balance                                                                                    $0                             $0



 



Consensus Revenue Forecast



Highway Use Tax                                                                    1,150,500,000          1,179,800,000



Motor Fuels Tax                                                                         619,500,000             627,900,000



Sales Tax Transfer                                                                      514,400,000             530,600,000



Fees                                                                                             172,100,000             172,500,000



Investment Income                                                                       33,000,000               37,200,000



 



Adjustments to Availability



Duplicate Registration Fees                                                             (900,000)                 (900,000)



Sales Tax Net of Trade                                                                     (300,000)                 (600,000)



 



Total Highway Trust Fund Availability                            $2,488,300,000        $2,546,500,000



 



PART IV. OTHER AVAILABILITY AND APPROPRIATIONS



 



Other Appropriations



SECTION 4.1.(a)  State funds, as defined in G.S. 143C‑1‑1(d)(25), are appropriated for each year of the 2025‑2027 fiscal biennium, as follows:



(1)        All budget codes listed in the Governor's Recommended Base Budget for the 2025‑2027 fiscal biennium, submitted pursuant to G.S. 143C‑3‑5, are appropriated up to the amounts specified, as adjusted by the General Assembly in this act and as delineated in the Committee Report described in Section 45.2 of this act, or in another act of the General Assembly.



(2)        Agency receipts up to the amounts needed to implement the legislatively mandated salary increases and employee benefit increases provided in this act for each year of the 2025‑2027 fiscal biennium.



SECTION 4.1.(b)  Receipts collected in a fiscal year in excess of the amounts appropriated by this section shall remain unexpended and unencumbered until appropriated by the General Assembly, unless the expenditure of overrealized receipts in the fiscal year in which the receipts were collected is authorized by G.S. 143C‑6‑4. Overrealized receipts are appropriated in the amounts necessary to implement this subsection.



SECTION 4.1.(c)  Funds may be expended only for the specified programs, purposes, objects, and line items or as otherwise authorized by the General Assembly.



 



Other Receipts from Pending Award Grants



SECTION 4.2.(a)  Notwithstanding G.S. 143C‑6‑4, State agencies may, with approval of the Director of the Budget, spend funds received from grants awarded after the enactment of this act for grant awards that are for less than two million five hundred thousand dollars ($2,500,000). State agencies shall report to the Joint Legislative Commission on Governmental Operations, the chairs of the Senate Committee on Appropriations/Base Budget, the chairs of the House Appropriations Committee, and the Fiscal Research Division within 30 days of receipt of such funds.



State agencies may spend up to the greater of one percent (1%) or ten million dollars ($10,000,000) of the total amount of grants awarded after the enactment of this act to respond to an emergency, as defined in G.S. 166A‑19.3, with the approval of the Director of the Budget. State agencies shall report to the Joint Legislative Commission on Governmental Operations, the chairs of the Senate Committee on Appropriations/Base Budget, the chairs of the House Appropriations Committee, and the Fiscal Research Division within 30 days of receipt of such funds, including specifying the total amount of grants awarded to respond to the emergency.



State agencies may spend all other funds from grants awarded after the enactment of this act only with approval of the Director of the Budget and after consultation with the Joint Legislative Commission on Governmental Operations.



SECTION 4.2.(b)  The Office of State Budget and Management shall work with the recipient State agencies to budget grant awards according to the annual program needs and within the parameters of the respective granting entities. Depending on the nature of the award, additional State personnel may be employed on a time‑limited basis. Funds received from such grants are hereby appropriated up to the applicable amount set forth in subsection (a) of this section and shall be incorporated into the authorized budget of the recipient State agency.



SECTION 4.2.(c)  Notwithstanding the provisions of this section, no State agency may accept a grant not anticipated in this act if (i) acceptance of the grant would obligate the State to make future expenditures relating to the program receiving the grant or would otherwise result in a financial obligation as a consequence of accepting the grant funds or (ii) the grant funds will be used for a capital project.



 



Education Lottery Funds



SECTION 4.3.(a)  The allocations made from the Education Lottery Fund for the 2025‑2027 fiscal biennium are as follows:



FY 2025‑2026           FY 2026‑2027



Noninstructional Support Personnel                                         $385,914,455           $385,914,455



Prekindergarten Program                                                              78,252,110               78,252,110



Public School Building Capital Fund                                         100,000,000             100,000,000



Needs‑Based Public School Capital Fund                                  280,120,000             282,680,000



Public School Repair & Renovation                                            70,000,000               70,000,000



Scholarship Reserve Fund for Public Colleges



and Universities                                                                      28,819,733               28,819,733



School Transportation                                                                182,193,702             186,033,702



TOTAL ALLOCATION                                                     $1,125,300,000        $1,131,700,000



 



SECTION 4.3.(b)  Notwithstanding G.S. 18C‑164(b3), the sum of one hundred one million forty thousand dollars ($101,040,000) in net revenues from the 2024‑2025 fiscal year, after appropriation pursuant to G.S. 18C‑164(b1) and transfer pursuant to G.S. 18C‑164(b2), shall be allocated to and remain available for school transportation for the 2025-2026 fiscal year. Funds remaining after the allocation described in this subsection shall be appropriated to the Needs‑Based Public School Capital Fund.



SECTION 4.3.(c)  Subsection (b) of this section becomes effective June 30, 2025. The remainder of this section becomes effective July 1, 2025.



 



Indian Gaming Education Revenue Fund Appropriations



SECTION 4.4.  The allocations made from the Indian Gaming Education Revenue Fund for the 2025‑2027 fiscal biennium are as follows:



FY 2025‑2026             FY 2026‑2027



Instructional Materials Allotment                                              $10,000,000             $10,000,000



Classroom Materials Allotment                                                    25,500,000                 3,500,000



Total Appropriation                                                                 $35,500,000             $13,500,000



 



Civil Penalty and Forfeiture Fund



SECTION 4.5.  The allocations made from the Civil Penalty and Forfeiture Fund for the 2025-2027 fiscal biennium are as follows:



                                                                                                  FY 2025‑2026          FY 2026‑2027



School Technology Fund                                                            $18,000,000             $18,000,000



Drivers Education                                                                         31,493,768               31,493,768



State Public School Fund                                                           186,041,640             166,041,640



Total Appropriation                                                               $235,535,408           $215,535,408



 



Arpa Temporary Savings FUnd



SECTION 4.6.(a)  General. – Funds appropriated in this act from the ARPA Temporary Savings Fund, established in Section 1.3(a) of S.L. 2023‑7, to State agencies and departments shall be used for the purposes described in this act, or in the Committee Report described in Section 45.2 of this act, for the fiscal year in which they are appropriated. Funds appropriated in this act from the ARPA Temporary Savings Fund shall not revert.



SECTION 4.6.(b)  Availability of Funds and Timing of Disbursements. – The funds appropriated in this act from the ARPA Temporary Savings Fund shall become available during the course of the 2025‑2026 fiscal year as the funds are deposited into that Fund. The Department of Health and Human Services (DHHS) shall not disburse allocations of the funds appropriated in this act from the ARPA Temporary Savings Fund until the funds are available within that Fund. DHHS shall disburse funds on at least a quarterly basis, or more frequently, provided funds are available within the Fund. Funds allocated as described in this act, or in the Committee Report described in Section 45.2 of this act, shall be disbursed as directed under subsection (c) of this section.



SECTION 4.6.(c)  Priority of Disbursement of Funds in the 2025‑2026 Fiscal Year. – For the 2025‑2026 fiscal year, funds appropriated in this act from the ARPA Temporary Savings Fund and allocated as described in this act, or in the Committee Report described in Section 45.2 of this act, shall be disbursed based upon the amount of funds being allocated, least to most.



 



PART V. GENERAL PROVISIONS



 



Establishing or Increasing Fees



SECTION 5.1.(a)  Notwithstanding G.S. 12‑3.1, an agency is not required to consult with the Joint Legislative Commission on Governmental Operations prior to establishing or increasing a fee to the level authorized or anticipated in this act.



SECTION 5.1.(b)  Notwithstanding G.S. 150B‑21.1A(a), an agency may adopt an emergency rule in accordance with G.S. 150B‑21.1A to establish or increase a fee as authorized by this act if the adoption of a rule would otherwise be required under Article 2A of Chapter 150B of the General Statutes.



 



Directed Grants to Non‑state Entities



SECTION 5.2.(a)  Definitions. – For purposes of this act and the Committee Report described in Section 45.2 of this act, the following definitions apply:



(1)        Directed grant. – Nonrecurring funds, specifically identified as directed grants, that are allocated by a State agency to a non‑State entity as directed by an act of the General Assembly.



(2)        Non‑State entity. – As defined in G.S. 143C‑1‑1.



SECTION 5.2.(b)  Requirements. – Nonrecurring funds appropriated in this act as directed grants are subject to all of the following requirements:



(1)        Directed grants are subject to the provisions of subsections (b) through (k) of G.S. 143C‑6‑23, with the exception that the deadline for expending, encumbering, or disbursing grant funds established by G.S. 143C‑6‑23(f1)(1) shall not apply unless the terms of the applicable appropriation specifically state otherwise.



(2)        Directed grants of one hundred thousand dollars ($100,000) or less may be made in a single annual payment in the discretion of the Director of the Budget. Directed grants of more than one hundred thousand dollars ($100,000) shall be made in quarterly or monthly payments in the discretion of the Director of the Budget. A State agency administering a directed grant shall begin disbursement of funds to a non‑State entity that meets all applicable requirements as soon as practicable, but no later than 100 days after the date this act becomes law. Full disbursement of funds to a non‑State entity that meets all applicable requirements shall be completed no later than nine months after the date this act becomes law.



(3)        Beginning on the first day of a quarter following the deadline provided in subdivision (2) of this subsection and quarterly thereafter, State agencies administering directed grants shall report to the Fiscal Research Division on the status of funds disbursed for each directed grant until all funds are fully disbursed. At a minimum, the report required under this subdivision shall include updates on (i) the date of the initial contact, (ii) the date the contract was sent to the entity receiving the funds, (iii) the date the disbursing agency received the fully executed contract back from the entity, (iv) the contract execution date, and (v) the payment date.



(4)        Notwithstanding any provision of G.S. 143C‑1‑2(b) to the contrary, nonrecurring funds appropriated in this act for the 2025‑2026 fiscal year as directed grants shall not revert until two years after this act becomes law, and nonrecurring funds appropriated in this act for the 2026‑2027 fiscal year as directed grants shall not revert until June 30, 2028.



(5)        Directed grants to nonprofit organizations are for nonsectarian, nonreligious purposes only.



SECTION 5.2.(c)  This section expires on June 30, 2028.



 



Cap State‑Funded Portion of Nonprofit Salaries



SECTION 5.3.  No more than one hundred forty thousand dollars ($140,000) in State funds, including any interest earnings accruing from those funds, may be used for the annual salary of any individual employee of a nonprofit organization.



 



Vacant Position Flexibility



SECTION 5.4.  By October 1 of each year of the 2025‑2027 fiscal biennium, State agencies with vacant position reductions identified in the Committee Report described in Section 45.2 of this act that are not identified by position number shall eliminate vacant positions to achieve the budgeted reduction in each of those years. Each State agency with vacant position reductions shall report to the Fiscal Research Division by December 1 of each year of the 2025‑2027 fiscal biennium on the actions taken to achieve the budgeted reduction for vacant position eliminations for that fiscal year. The report shall include a list of each position eliminated, identified by position number, title, and the amount of salary and fringe benefits associated with the position.



 



Children's Hospital Antitrust/State Action Immunity



SECTION 5.5.(a)  G.S. 116‑350 is amended by adding a new subdivision to read:



(3a)    North Carolina Children's Health or NCC. – A pediatric health facility and associated sites that (i) receive State funding and (ii) are developed by the System in partnership with Duke University Health System, Inc.



SECTION 5.5.(b)  Part 1 of Article 37A of Chapter 116 of the General Statutes is amended by adding a new section to read:



§ 116‑350.70.  State action.



Subject to the provisions and limitations of this Part and Part 2 of this Article, the Board may enter into cooperative agreements with Duke University Health System, Inc., Duke University, any component of The University of North Carolina, NCC, or any combination thereof for the provision of pediatric research, health care, and discovery, including the development and joint operation of NCC, without regard to the effect on market competition. In partnering with Duke University Health System, Inc., Duke University, The University of North Carolina, NCC, or any combination thereof for these purposes, the System is acting according to State policy by ensuring (i) pediatric health care is made available to all parts of North Carolina and (ii) North Carolina is at the forefront of pediatric research, health care delivery, and innovation. The activities by the System pursuant to this section constitute State action for purposes of antitrust law. The General Assembly intends that these agreements are immune from the application of federal and State antitrust law.



 



NO CERTIFICATE OF NEED required FOR activities pertaining to NORTH CAROLINA CHILDREN'S HEALTH, INC.



SECTION 5.6.(a)  G.S. 131E‑176 is amended by adding a new subdivision to read:



(16a)  North Carolina Children's Health, Inc., or NCC. – A pediatric‑focused health system that includes a new children's hospital and associated sites developed and constructed on behalf of the State of North Carolina, established in whole or in part by State funds appropriated to the UNC Board of Governors and allocated to UNC Health System pursuant to the Committee Report described in Section 43.2 of S.L. 2023‑134.



SECTION 5.6.(b)  Article 9 of Chapter 131E of the General Statutes is amended by adding a new section to read:



§ 131E‑178.1.  No certificate of need required for activities pertaining to North Carolina Children's Health, Inc.



(a)        Notwithstanding G.S. 131E‑178(a) or any other provision of this Article, a certificate of need is not required for any of the following activities pertaining to NCC:



(1)        The construction, development, or other establishment of NCC.



(2)        Any capital expenditure by or on behalf of NCC that exceeds the monetary threshold set forth in G.S. 131E‑176(16)b.



(3)        The development or offering of clinical patient services at NCC, including any health services specified in G.S. 131E‑176(16)f.



(4)        The acquisition, improvement, expansion, replacement, or relocation of any equipment, including diagnostic equipment, major medical equipment, replacement equipment, and any equipment specified in G.S. 131E‑176(16)f1., for use at NCC regardless of cost.



(5)        Any change in bed capacity, as defined in G.S. 131E‑176(5), at NCC.



(6)        The construction, development, establishment, increase in the number, or relocation of an operating room or gastrointestinal endoscopy room at NCC.



(b)        Nothing in this section shall be construed to affect the ability or obligation of NCC to comply with existing licensure laws and requirements that are applicable to any facilities or clinical patient services developed or offered at NCC.



SECTION 5.6.(c)  This section is effective when it becomes law.



 



NCInnovation



SECTION 5.7.(a)  Transfer of Funds. – NCInnovation shall transfer back to the State, after consultation with, and in conformity with direction received from, the State Controller, the sum of one hundred million dollars ($100,000,000). NCInnovation shall, after consultation with, and in conformity with direction received from, the State Controller, transfer to the Board of Governors of The University of North Carolina the sum of four hundred million dollars ($400,000,000) to be used for North Carolina Children's Health, Inc., as defined in G.S. 131E‑176, as amended by this act.



SECTION 5.7.(b)  NCInnovation Reserve. – The State Controller shall facilitate the transfers required by subsection (a) of this section. The State Controller shall deposit the funds returned to the State into the NCInnovation Reserve established in Section 2.2(k) of S.L. 2023‑134. The transfer and deposit of funds into the reserve pursuant to this section does not constitute an appropriation made by law, as that phrase is used in Section 7(1) of Article V of the North Carolina Constitution, and such funds shall remain unappropriated unless the General Assembly appropriates the funds in this, or a subsequent, act. In accordance with G.S. 147‑69.1(d), funds in the Reserve shall be invested by the Department of the State Treasurer, with earnings and interest therefrom being transferred to and deposited in the General Fund.



SECTION 5.7.(c)  Repeal. – Upon the transfers of funds pursuant to subsection (a) of this section, Article 76A of Chapter 143 of the General Statutes is repealed. The State Controller shall notify the Revisor of Statutes when the transfers have been completed.



SECTION 5.7.(d)  Appropriation. – There is appropriated from the NCInnovation Reserve to the Department of State Treasurer (i) the sum of twenty‑five million dollars ($25,000,000) in nonrecurring funds for the 2025‑2026 fiscal year, (ii) the sum of twenty‑five million dollars ($25,000,000) in nonrecurring funds for the 2026‑2027 fiscal year, (iii) the sum of twenty‑five million dollars ($25,000,000) in nonrecurring funds for the 2027‑2028 fiscal year, and (iv) the sum of twenty‑five million dollars ($25,000,000) in nonrecurring funds for the 2028‑2029 fiscal year. The State Treasurer shall allocate the funds appropriated in this subsection in the designated fiscal year to NCInnovation, Inc. (NCInnovation), a North Carolina nonprofit corporation under section 501(c)(3) of the Internal Revenue Code, to be used for purposes consistent with this section.



SECTION 5.7.(e)  Findings. – The General Assembly of North Carolina finds North Carolina is competing with other states for the ability to commercialize innovations sourced from the State's world‑class university and community college systems. By fully optimizing the commercialization of those innovations, the State has opportunities for creating new jobs and new companies and achieving greater economic prosperity, particularly in rural areas. Other states have successfully harnessed innovation efforts from research universities to create jobs, to accelerate commercial opportunities, and to support the commercial growth and scale of emerging technologies. North Carolina will benefit from similar efforts to accelerate commercialization of theoretical and applied science and inventions stemming from the efforts and activities of its higher education research institutions.



SECTION 5.7.(f)  Purpose; Use. – The purpose of the appropriations made in this section is to promote the economic welfare and growth of the State by facilitating NCInnovation in establishing a network of regional innovation hubs, leveraging the high technology research and development capabilities of the State's higher education research institutions, bridging the gap between such research and development capabilities and the application and commercialization of the same, and supporting such commercialization, application, and resulting emerging technologies. NCInnovation shall use funds appropriated to it for the following purposes:



(1)        To establish and support a regional network of at least four university research hubs, each located in areas of the State where regional collaboration between academic, industrial, and capital formation networks are at or below average in comparison to the rest of the State. NCInnovation shall provide full‑time, collocated educational liaisons, business consultants, and technology transfer consultants in each hub to improve relationships and engagement between senior educational and regional industry leaders and among regional networks and to analyze higher education research activities, capacities, and capabilities in light of commercial innovation needs in the hub to align strengths, to fill gaps, to identify gap‑filling patent and research and to create a strategic plan to guide future investments and identify resources or infrastructure required to implement and apply patents and research into commercialized innovation.



(2)        To award grants, funds, and other resources, including solicited funds, (i) to higher education research institutions under programs designed to advance research and development to proof of commercial viability and (ii) to otherwise undertake actions designed to accelerate the commercialization of applied research projects to and beyond the point of proof of concept. In distributing awards made pursuant to this subdivision, NCInnovation may use the North Carolina Collaboratory, established under G.S. 116‑255.



SECTION 5.7.(g)  Duties; Limitations. – In receiving and using State funds pursuant to this section, NCInnovation shall adhere to all of the following:



(1)        NCInnovation shall protect the use of State funds by requiring, as a condition of awarding funds or providing support, that the recipient, for a minimum of five years, (i) has its headquarters and principal place of business in the State and (ii) be organized under the laws of this State for any commercialization resulting from or furthered by, in whole or part, such funds or support. State funds may not be used to award dilutive grants contingent upon future revenue or equity or ownership interests of any kind.



(2)        To the extent NCInnovation uses State funds for annual salaries and severance, NCInnovation shall limit the use only for personnel located at a regional hub established by NCInnovation. The annual salary for such personnel shall not exceed the amount most recently set by the General Assembly in a Current Operations Appropriations Act.



(3)        NCInnovation shall maintain its status as a North Carolina nonprofit corporation and shall adopt, publish, and maintain policies for conflicts of interest and gifts. In addition, NCInnovation shall report to the Department of the State Treasurer and the Office of the State Auditor on each incidence where a person, including a related member of a person, has made a reported contribution and has received funds or support from NCInnovation.



(4)        NCInnovation shall report on its programs and activities to the Joint Legislative Economic Development and Global Engagement Oversight Committee and the Fiscal Research Division on or before September 15 of each fiscal year and more frequently as requested by any of these entities. The report shall include all of the following:



a.         Expenditures for establishing and supporting a network of regional innovation hubs, including salaries, and awards of grants, funds, or other support by NCInnovation in the prior fiscal year. This information shall include, at a minimum, the recipient, amount, term, and purpose of the award and shall be itemized by program and county.



b.         Outcome data collected by NCInnovation, including the number of jobs created.



c.         Developed performance metrics for recipients of funding and support by NCInnovation.



(5)        NCInnovation shall be subject to oversight from the Office of the State Auditor, which shall include a performance audit of NCInnovation programs not less than every three years. NCInnovation shall submit to the Office of the State Auditor a copy of its audited financial statements within 30 days of receipt of the audit, and the State Auditor may elect to rely upon the submitted audit or conduct its own inquiry or audit of NCInnovation.



(6)        NCInnovation shall maintain separate accounting records for and separate accounts for State funds and shall not commingle State funds with other amounts. NCInnovation shall maintain records and accounts according to generally accepted accounting principles.



(7)        NCInnovation shall not use State funds (i) to hire a lobbyist, (ii) in excess of one and one‑half percent (1.5%) of the annual amount of State funds received for overhead and administrative costs, (iii) for costs for alcohol, first‑class airfare, charter flights, or holiday parties or similar social gatherings, or (iv) for any formal or informal meeting or gathering located outside of the State unless directly related to NCInnovation's programs or advancing State interests in innovation commercialization.



SECTION 5.7.(h)  This section is effective when it becomes law.



 



State Budget Act Technical Changes



SECTION 5.8.(a)  G.S. 143C‑1‑1 reads as rewritten:



§ 143C‑1‑1.  Purpose and definitions.



…



(d)       Definitions. – The following definitions apply in this Chapter:



…



(20)      Object or line item. – An expenditure or receipt in a recommended or enacted budget that is designated in the Budget Code Structure of the North Carolina Accounting Financial System Uniform Chart of Accounts prescribed by the Office of the State Controller.



…



(23)      Purpose or program. – A group of objects or line items for support of a specific activity for a State agency outlined in a recommended or enacted budget that is designated by a nine‑digit six‑digit fund code in accordance with the Budget Code Structure of the North Carolina Accounting Financial System Uniform Chart of Accounts prescribed by the Office of the State Controller.



….



SECTION 5.8.(b)  G.S. 143C‑3‑5 reads as rewritten:



§ 143C‑3‑5.  Budget recommendations and budget message.



…



(b)        Odd‑Numbered Years. – In odd‑numbered years the budget recommendations shall include the following components:



…



(2)        A Recommended Base Budget showing, for each budget code and purpose or program in State government, accounting detail corresponding to the Recommended State Budget.



a.         The Recommended Base Budget shall employ the North Carolina Accounting Financial System Uniform Chart of Accounts adopted by the State Controller to show both uses and sources of funds and shall display in separate parallel columns all of the following: (i) actual expenditures and receipts for the most recent fiscal year for which actual information is available, (ii) the certified budget for the preceding fiscal year, (iii) the currently authorized budget for the preceding fiscal year, (iv) program base budget requirements for each fiscal year of the biennium, (v) proposed expenditures and receipts for each fiscal year of the biennium, and (vi) proposed increases and decreases.



…



(7)        The Governor's Recommended State Budget shall include a transfer to the State Capital and Infrastructure Fund of four percent (4%) of the estimated net State tax revenues that are deposited in the General Fund for each fiscal year of the upcoming biennium.in accordance with G.S. 143C‑4‑3.1(b)(1).



….



SECTION 5.8.(c)  G.S. 143C‑6‑11 reads as rewritten:



Part 2. Highway Appropriations.



§ 143C‑6‑11.  Highway appropriation.



…



(l)         It is the intent of the General Assembly to (i) prevent the inclusion of duplicative fund codes in the Highway Fund certified budget and (ii) correctly align authorized positions and associated operating costs with the appropriate purposes and definitions as defined in G.S. 143C‑1‑1. To that end, the Office of State Budget and Management, in consultation with the Department of Transportation, the Office of the State Controller, and the Fiscal Research Division of the General Assembly, shall include, as an appendix to the Highway Fund certified budget, object detail using the North Carolina Accounting Financial System Uniform Chart of Accounts prescribed by the Office of the State Controller to provide a more detailed accounting of the proposed budgets and receipts and actual expenditures and revenue collections. This requirement includes applying object detail at the four‑digit level for all accounts to full‑time and part‑time positions, to operating expenditures and receipts, and to intrafund transfers. Additionally, work order positions shall be budgeted within existing fund codes.



….



SECTION 5.8.(d)  G.S. 143C‑6‑13 is repealed.



 



Land Use Clarifications And Changes



 



schools permitted use in commercial zones



SECTION 5.9.  Part 1 of Article 9 of Chapter 160D of the General Statutes is amended by adding a new section to read:



§ 160D‑917.  Public school sites in commercial zones.



In areas zoned for commercial use, zoning regulations shall permit, by right or by special use, the siting of a school building that is primarily used for the instruction of students and is under the control of a public school unit as defined in G.S. 115C‑5.



 



clarify existing use rights on property



SECTION 5.10.(a)  G.S. 160D‑108 reads as rewritten:



§ 160D‑108.  Permit choice and vested rights.



…



(c)        Vested Rights. – Amendments in land development regulations are not applicable or enforceable without the written consent of the owner with regard to any of the following:



(1)        Buildings or uses of buildings or land for which a development permit application has been submitted and subsequently issued in accordance with G.S. 143‑755.



(2)        Subdivisions of land for which a development permit application authorizing the subdivision has been submitted and subsequently issued in accordance with G.S. 143‑755.



(3)        A site‑specific vesting plan pursuant to G.S. 160D‑108.1.



(4)        A multi‑phased development pursuant to subsection (f) of this section.



(5)        A vested right established by the terms of a development agreement authorized by Article 10 of this Chapter.



The establishment of a vested right under any subdivision of this subsection does not preclude vesting under one or more other subdivisions of this subsection or vesting by application of common law principles. A vested right, once established as provided for in this section or by common law, precludes any action by a local government that would change, alter, impair, prevent, diminish, or otherwise delay the development or use of the property allowed by the applicable land development regulation or regulations, except where a change in State or federal law mandating local government enforcement occurs after the development application is submitted that has a fundamental and retroactive effect on the development or use. A vested right obtained by permit or other local government approval shall not preclude the use or extinguish the existence of any other vested right or use by right attached to the property.



….



SECTION 5.10.(b)  G.S. 160D‑705 reads as rewritten:



§ 160D‑705.  Quasi‑judicial zoning decisions.



…



(c)        Special Use Permits. – The regulations may provide that the board of adjustment, planning board, or governing board hear and decide special use permits in accordance with principles, conditions, safeguards, and procedures specified in the regulations. Reasonable and appropriate conditions and safeguards may be imposed upon these permits. Where appropriate, such conditions may include requirements that street and utility rights‑of‑way be dedicated to the public and that provision be made for recreational space and facilities. Conditions and safeguards imposed under this subsection shall not include requirements for which the local government does not have authority under statute to regulate nor requirements for which the courts have held to be unenforceable if imposed directly by the local government, including, without limitation, taxes, impact fees, building design elements within the scope of G.S. 160D‑702(b), driveway‑related improvements in excess of those allowed in G.S. 136‑18(29) and G.S. 160A‑307, or other unauthorized limitations on the development or use of land.



The regulations may provide that defined minor modifications to special use permits that do not involve a change in uses permitted or the density of overall development permitted may be reviewed and approved administratively. Any other modification or revocation of a special use permit shall follow the same process for approval as is applicable to the approval of a special use permit. If multiple parcels of land are subject to a special use permit, the owners of individual parcels may apply for permit modification so long as the modification would not result in other properties failing to meet the terms of the special use permit or regulations. Any modifications approved apply only to those properties whose owners apply for the modification. The regulation may require that special use permits be recorded with the register of deeds. If a special use permit expires and does not vest, the current zoning classification or regulation for the property applies.



….



SECTION 5.10.(c)  G.S. 160D‑203 reads as rewritten:



§ 160D‑203.  Split jurisdiction.



(a)        If a parcel of land lies within the planning and development regulation jurisdiction of more than one local government, for the purposes of this Chapter, the local governments may, by mutual agreement pursuant to Article 20 of Chapter 160A of the General Statutes and with the written consent of the landowner, assign exclusive planning and development regulation jurisdiction under this Chapter for the entire parcel land, including all development phases on the land, to any one of those local governments.



(b)        In the event no mutual agreement or written consent under subsection (a) of this section exists, the landowner of land lying within the planning and development regulation jurisdiction of more than one local government may elect the planning and development regulations of the local government where the majority of the total acreage of the parcel of land is situated.



(c)        Such a mutual agreement This section shall only be applicable to planning and development regulations and shall not affect taxation or other nonregulatory matters. The mutual agreement under subsection (a) of this section shall be evidenced by a resolution formally adopted by each governing board and recorded with the register of deeds in the every county where the property land is located within 14 days of the adoption of the last required resolution.



(d)       For the purposes of this section, landowner means all titleholders of record owning an interest in the land.



SECTION 5.10.(d)  This section is effective when it becomes law.



 



remove extraterritorial jurisdiction authority



SECTION 5.11.(a)  G.S. 160D‑201 reads as rewritten:



§ 160D‑201.  Planning and development regulation jurisdiction.



(a)        Cities. – All of the powers granted by this Chapter may be exercised by any city within its corporate limits and within any extraterritorial area established pursuant to G.S. 160D‑202.limits.



….



SECTION 5.11.(b)  G.S. 160D‑202 reads as rewritten:



§ 160D‑202.  Municipal extraterritorial Transfer or relinquishment of jurisdiction.



(a)        Geographic Scope. – Any city may exercise the powers granted to cities under this Chapter within a defined area extending not more than one mile beyond its contiguous corporate limits. In addition, a city of 10,000 or more population but less than 25,000 may exercise these powers over an area extending not more than two miles beyond its limits and a city of 25,000 or more population may exercise these powers over an area extending not more than three miles beyond its limits. In determining the population of a city for the purposes of this Chapter, the city council and the board of county commissioners may use the most recent annual estimate of population as certified by the Secretary of the North Carolina Department of Administration. Pursuant to G.S. 160A‑58.4, extraterritorial municipal planning and development regulation may be extended only from the primary corporate boundary of a city and not from the boundary of satellite areas of the city.



(b)        Authority in the Extraterritorial Area. – A city may not exercise any power conferred by this Chapter in its extraterritorial jurisdiction that it is not exercising within its corporate limits. A city may exercise in its extraterritorial area all powers conferred by this Chapter that it is exercising within its corporate limits. If a city fails to extend a particular type of development regulation to the extraterritorial area, the county may elect to exercise that particular type of regulation in the extraterritorial area.



(c)        County Approval of City Jurisdiction. – Notwithstanding subsection (a) of this section, no city may extend its extraterritorial powers into any area for which the county has adopted and is enforcing county zoning and subdivision regulations. However, the city may do so where the county is not exercising both of these powers, or when the city and the county have agreed upon the area within which each will exercise the powers conferred by this Chapter. No city may extend its extraterritorial powers beyond one mile from its corporate limits without the approval of the board or boards of county commissioners with jurisdiction over the area.



(d)       Notice of Proposed Jurisdiction Change. – Any municipality proposing to exercise extraterritorial jurisdiction under this Chapter shall notify the owners of all parcels of land proposed for addition to the area of extraterritorial jurisdiction, as shown on the county tax records. The notice shall be sent by first‑class mail to the last addresses listed for affected property owners in the county tax records. The notice shall inform the landowner of the effect of the extension of extraterritorial jurisdiction, of the landowner's right to participate in a legislative hearing prior to adoption of any ordinance extending the area of extraterritorial jurisdiction, as provided in G.S. 160D‑601, and of the right of all residents of the area to apply to the board of county commissioners to serve as a representative on the planning board and the board of adjustment, as provided in G.S. 160D‑303. The notice shall be mailed at least 30 days prior to the date of the hearing. The person or persons mailing the notices shall certify to the city council that the notices were sent by first‑class mail, and the certificate shall be deemed conclusive in the absence of fraud.



(e)        Boundaries. – Any council exercising extraterritorial jurisdiction under this Chapter shall adopt an ordinance specifying the areas to be included based upon existing or projected urban development and areas of critical concern to the city, as evidenced by officially adopted plans for its development. A single jurisdictional boundary shall be applicable for all powers conferred in this Chapter. Boundaries shall be defined, to the extent feasible, in terms of geographical features identifiable on the ground. Boundaries may follow parcel ownership boundaries. A council may, in its discretion, exclude from its extraterritorial jurisdiction areas lying in another county, areas separated from the city by barriers to urban growth, or areas whose projected development will have minimal impact on the city. The boundaries specified in the ordinance shall at all times be drawn on a map, set forth in a written description, or shown by a combination of these techniques. This delineation shall be maintained in the manner provided in G.S. 160A‑22 for the delineation of the corporate limits and shall be recorded in the office of the register of deeds of each county in which any portion of the area lies.



Where the extraterritorial jurisdiction of two or more cities overlaps, the jurisdictional boundary between them shall be a line connecting the midway points of the overlapping area unless the city councils agree to another boundary line within the overlapping area based upon existing or projected patterns of development.



(f)        County Authority Within City Jurisdiction. – The county may, on request of the city council, exercise any or all of these the powers granted in this Chapter in any or all areas lying within the city's corporate limits or within the city's specified area of extraterritorial jurisdiction.limits.



(g)        Transfer of Jurisdiction. – When a city annexes, annexes or a new city is incorporated in, or a city extends its jurisdiction to include, in an area that is currently being regulated by the county, the county development regulations and powers of enforcement shall remain in effect until (i) the city has adopted such development regulations or (ii) a period of 60 days has elapsed following the annexation, extension, annexation or incorporation, whichever is sooner. Prior to the transfer of jurisdiction, the city may hold hearings and take any other measures consistent with G.S. 160D‑204 that may be required in order to adopt and apply its development regulations for the area at the same time it assumes jurisdiction.



(h)        Relinquishment of Jurisdiction. – When a city relinquishes jurisdiction over an area that it is regulating under this Chapter to a county, the city development regulations and powers of enforcement shall remain in effect until (i) the county has adopted such development regulation or (ii) a period of 60 days has elapsed following the action by which the city relinquished jurisdiction, whichever is sooner. Prior to the transfer of jurisdiction, the county may hold hearings and take other measures consistent with G.S. 160D‑204 that may be required in order to adopt and apply its development regulations for the area at the same time it assumes jurisdiction.



(i)         Process for Local Government Approval. – When a local government is granted powers by this section subject to the request, approval, or agreement of another local government, the request, approval, or agreement shall be evidenced by a formally adopted resolution of the governing board of the local government. Any such request, approval, or agreement can be rescinded upon two years' written notice to the other governing boards concerned by repealing the resolution. The resolution may be modified at any time by mutual agreement of the governing boards concerned.



(j)         Local Acts. – Nothing in this section shall repeal, modify, or amend any local act that defines the boundaries of a city's extraterritorial jurisdiction by metes and bounds or courses and distances.



(k)        Effect on Vested Rights. – Whenever a city or county, pursuant to this section, acquires jurisdiction over a territory that theretofore has been subject to the jurisdiction of another local government, any person who has acquired vested rights in the surrendering jurisdiction may exercise those rights as if no change of jurisdiction had occurred. The city or county acquiring jurisdiction may take any action regarding such a development approval, certificate, or other evidence of compliance that could have been taken by the local government surrendering jurisdiction pursuant to its development regulations. Except as provided in this subsection, any building, structure, or other land use in a territory over which a city or county has acquired jurisdiction is subject to the development regulations of the city or county.



SECTION 5.11.(c)  G.S. 160D‑307 is repealed.



SECTION 5.11.(d)  G.S. 160D‑602 reads as rewritten:



§ 160D‑602.  Notice of hearing on proposed zoning map amendments.



(a)        Mailed Notice. – Subject to the limitations of this Chapter, an ordinance shall provide for the manner in which zoning regulations and the boundaries of zoning districts are to be determined, established, and enforced, and from time to time amended, supplemented, or changed, in accordance with the provisions of this Chapter. The owners of affected parcels of land and the owners of all parcels of land abutting that parcel of land shall be mailed a notice of the hearing on a proposed zoning map amendment by first‑class mail at the last addresses listed for such owners on the county tax abstracts. For the purpose of this section, properties are abutting even if separated by a street, railroad, or other transportation corridor. This notice must be deposited in the mail at least 10 but not more than 25 days prior to the date of the hearing. If the zoning map amendment is being proposed in conjunction with an expansion of municipal extraterritorial planning and development regulation jurisdiction under G.S. 160D‑202, a single hearing on the zoning map amendment and the boundary amendment may be held. In this instance, the initial notice of the zoning map amendment hearing may be combined with the boundary hearing notice and the combined hearing notice mailed at least 30 days prior to the hearing.



….



SECTION 5.11.(e)  G.S. 160D‑903(c) is repealed.



SECTION 5.11.(f)  G.S. 160D‑912 reads as rewritten:



§ 160D‑912.  Outdoor advertising.



…



(m)       This section does not apply to any ordinance in effect on July 1, 2004. A local government may amend an ordinance in effect on July 1, 2004, to extend application of the ordinance to off‑premises outdoor advertising located in territory acquired by annexation or located in the extraterritorial jurisdiction of the city. annexation. A local government may repeal or amend an ordinance in effect on July 1, 2004, so long as the amendment to the existing ordinance does not reduce the period of amortization in effect on June 19, 2020.



….



SECTION 5.11.(g)  G.S. 160D‑925(e) is repealed.



SECTION 5.11.(h)  G.S. 160D‑1102(a) reads as rewritten:



(a)      A local government may create an inspection department and may appoint inspectors who may be given appropriate titles, such as building inspector, electrical inspector, plumbing inspector, housing inspector, zoning inspector, heating and air‑conditioning inspector, fire prevention inspector, or deputy or assistant inspector, or another title generally descriptive of the duties assigned. Every local government shall perform the duties and responsibilities set forth in G.S. 160D‑1104 either by (i) creating its own inspection department, (ii) creating a joint inspection department in cooperation with one or more other units of local government, pursuant to Part 1 of Article 20 of Chapter 160A of the General Statutes, (iii) contracting with another unit of local government for the provision of inspection services pursuant to Part 1 of Article 20 of Chapter 160A of the General Statutes, or (iv) arranging for the county in which a city is located to perform inspection services within the city's jurisdiction as authorized by G.S. 160D‑1104 and G.S. 160D‑202. G.S. 160D‑1104. Every local government shall designate a person responsible for the daily oversight of the local government's duties and responsibilities under G.S. 160D‑1104.



SECTION 5.11.(i)  G.S. 160D‑1125(c) reads as rewritten:



(c)      Additional Lien. – The amounts incurred by a local government in connection with the removal or demolition are also a lien against any other real property owned by the owner of the building or structure and located within the local government's planning and development regulation jurisdiction, and for cities without extraterritorial planning and development jurisdiction, within one mile of the city limits, jurisdiction, except for the owner's primary residence. The provisions of subsection (b) of this section apply to this additional lien, except that this additional lien is inferior to all prior liens and shall be collected as a money judgment.



SECTION 5.11.(j)  G.S. 113A‑208(d) reads as rewritten:



(d)      An ordinance adopted under the authority of this section applies to all protected mountain ridges as defined in G.S. 113A‑206. A county or city may apply the ordinance to other mountain ridges within its jurisdiction if it finds that this application is reasonably necessary to protect against some or all of the hazards or problems set forth in G.S. 113A‑207. Additionally, a city with a population of 50,000 or more may apply the ordinance to other mountain ridges within its extraterritorial planning jurisdiction if it finds that this application is reasonably necessary to protect against some or all of the hazards or problems set forth in G.S. 113A‑207.



SECTION 5.11.(k)  G.S. 130A‑317(d) reads as rewritten:



(d)      Municipalities, counties, local boards or commissions, water and sewer authorities, or groups of municipalities and counties may establish and administer within their utility service areas their own approval program in lieu of State approval of water system plans required in subsection (c) of this section for construction or alteration of the distribution system of a proposed or existing public water system, subject to the prior certification of the Department. For purposes of this subsection, the service area of a municipality shall include only that area within the corporate limits of the municipality and that area outside a municipality in its extraterritorial jurisdiction where water service is already being provided to the permit applicant by the municipality or connection to the municipal water system is immediately available to the applicant; the service areas of counties and the other entities or groups shall include only those areas where water service is already being provided to the applicant by the permitting authority or connection to the permitting authority's system is immediately available. For purposes of this subsection, the term extraterritorial jurisdiction means the boundaries of the area over which a municipality was exercising extraterritorial planning jurisdiction under Article 19 of Chapter 160A of the General Statutes, or its successor Chapter 160D of the General Statutes, prior to the municipality's relinquishment of extraterritorial planning jurisdiction over the area in accordance with the law. No later than the 180th day after the receipt of an approval program and statement submitted by any local government, commission, authority, or board, the Department shall certify any local program that meets all of the following conditions:



….



SECTION 5.11.(l)  G.S. 136‑55.1(b) reads as rewritten:



(b)      In keeping with its overall zoning scheme and long‑range plans regarding the extraterritorial jurisdiction area, a A municipality may keep open and assume responsibility for maintenance of a road within one mile of its corporate limits once it is abandoned from the State highway system.



SECTION 5.11.(m)  G.S. 136‑63(b) reads as rewritten:



(b)      In keeping with its overall zoning scheme and long‑range plans regarding the extraterritorial jurisdiction area, a A municipality may keep open and assume responsibility for maintenance of a road within one mile of its corporate limits once it is abandoned from the State highway system.



SECTION 5.11.(n)  G.S. 136‑66.3(a) reads as rewritten:



(a)      Municipal Participation Authorized. – A municipality may, but is not required to, participate in the right‑of‑way and construction cost of a State transportation improvement approved by the Board of Transportation under G.S. 143B‑350(f)(4) that is located in the municipality or its extraterritorial jurisdiction.municipality.



SECTION 5.11.(o)  G.S. 143‑138(e) reads as rewritten:



(e)      Effect upon Local Codes. – Except as otherwise provided in this section, the North Carolina State Building Code shall apply throughout the State, from the time of its adoption. Approved rules shall become effective in accordance with G.S. 150B‑21.3. However, any political subdivision of the State may adopt a fire prevention code and floodplain management regulations within its jurisdiction. Provided a political subdivision shall not adopt local fire prevention code provisions which apply to dwellings subject to the North Carolina Residential Code which are not prescriptively required by the North Carolina Residential Code. The territorial jurisdiction of any municipality or county for this purpose, unless otherwise specified by the General Assembly, shall be as follows: Municipal jurisdiction shall include all areas within the corporate limits of the municipality and extraterritorial jurisdiction areas established as provided in G.S. 160D‑202 or a local act; municipality; county jurisdiction shall include all other areas of the county. No such code or regulations, other than floodplain management regulations and those permitted by G.S. 160D‑1128, shall be effective until they have been officially approved by the responsible Code Council as providing adequate minimum standards to preserve and protect health and safety, in accordance with the provisions of subsection (c) above. Local floodplain regulations may regulate all types and uses of buildings or structures located in flood hazard areas identified by local, State, and federal agencies, and include provisions governing substantial improvements, substantial damage, cumulative substantial improvements, lowest floor elevation, protection of mechanical and electrical systems, foundation construction, anchorage, acceptable flood resistant materials, and other measures the political subdivision deems necessary considering the characteristics of its flood hazards and vulnerability. In the absence of approval by the Building Code Council or Residential Code Council, or in the event that approval is withdrawn, local fire prevention codes and regulations shall have no force and effect. Provided any local regulations approved by the local governing body which are found by the Council to be more stringent than the adopted statewide fire prevention code and which are found to regulate only activities and conditions in buildings, structures, and premises that pose dangers of fire, explosion or related hazards, and are not matters in conflict with the Code, may be approved. Local governments may enforce the fire prevention code of the Code using civil remedies authorized under G.S. 143‑139, 153A‑123, and 160A‑175. If the State Fire Marshal or other State official with responsibility for enforcement of the Code institutes a civil action pursuant to G.S. 143‑139, a local government may not institute a civil action under G.S. 143‑139, 153A‑123, or 160A‑175 based upon the same violation. Appeals from the assessment or imposition of such civil remedies shall be as provided in G.S. 160D‑1127.



A local government may not adopt any ordinance In conflict with the exemption provided by subsection (c1) of this section. No local ordinance or regulation shall be construed to limit the exemption provided by subsection (c1) of this section.



SECTION 5.11.(p)  G.S. 143‑215.1(f) reads as rewritten:



(f)       Local Permit Programs for Sewer Extension and Reclaimed Water Utilization. – Municipalities, counties, local boards or commissions, water and sewer authorities, or groups of municipalities and counties may establish and administer within their utility service areas their own general permit programs in lieu of State permit required in G.S. 143‑215.1(a)(2), (3), and (8) above, for construction, operation, alteration, extension, change of proposed or existing sewer system, subject to the prior certification of the Commission. For purposes of this subsection, the service area of a municipality shall include only that area within the corporate limits of the municipality and that area outside a municipality in its extraterritorial jurisdiction where sewer service or a reclaimed water utilization system is already being provided by the municipality to the permit applicant or connection to the municipal sewer system or a reclaimed water utilization system is immediately available to the applicant; the service areas of counties and the other entities or groups shall include only those areas where sewer service or a reclaimed water utilization system is already being provided to the applicant by the permitting authority or connection to the permitting authority's system is immediately available. For purposes of this subsection, the term extraterritorial jurisdiction means the boundaries of the area over which a municipality was exercising extraterritorial planning jurisdiction under Article 19 of Chapter 160A of the General Statutes, or its successor Chapter 160D of the General Statutes, prior to the municipality's relinquishment of extraterritorial planning jurisdiction over the area in accordance with the law. No later than the 180th day after the receipt of a program and statement submitted by any local government, commission, authority, or board the Commission shall certify any local program that does all of the following:



….



SECTION 5.11.(q)  G.S. 153A‑317.14(a)(6) is repealed.



SECTION 5.11.(r)  G.S. 160A‑58.4 reads as rewritten:



§ 160A‑58.4.  Extraterritorial powers.



Satellite corporate limits shall not be considered a part of the city's corporate limits for the purposes of extraterritorial land‑use regulation pursuant to G.S. 160D‑202 or abatement of public health nuisances pursuant to G.S. 160A‑193. However, a city's power to regulate land use pursuant to Chapter 160D of the General Statutes or to abate public health nuisances pursuant to G.S. 160A‑193, shall be the same within satellite corporate limits as within its primary corporate limits.



SECTION 5.11.(s)  G.S. 160A‑176.1(a) reads as rewritten:



(a)      A city may adopt ordinances to regulate and control swimming, surfing and littering in the Atlantic Ocean adjacent to that portion of the city within its boundaries or within its extraterritorial jurisdiction; boundaries; provided, however, nothing contained herein shall be construed to permit any city to prohibit altogether swimming and surfing or to make these activities unlawful.



SECTION 5.11.(t)  G.S. 160A‑176.2(a) reads as rewritten:



(a)      A city may adopt ordinances to regulate and control swimming, personal watercraft operation, surfing and littering in the Atlantic Ocean and other waterways adjacent to that portion of the city within its boundaries or within its extraterritorial jurisdiction; boundaries; provided, however, nothing contained herein shall be construed to permit any city to prohibit altogether swimming or surfing or to make these activities unlawful.



SECTION 5.11.(u)  G.S. 160A‑296(a1) is repealed.



SECTION 5.11.(v)  G.S. 160A‑299(d) reads as rewritten:



(d)      This section shall apply to any street or public alley within a city or its extraterritorial jurisdiction that has been irrevocably dedicated to the public, without regard to whether it has actually been opened. This section also applies to unopened streets or public alleys that are shown on plats but that have not been accepted or maintained by the city, provided that this section shall not abrogate the rights of a dedicator, or those claiming under a dedicator, pursuant to G.S. 136‑96.



SECTION 5.11.(w)  Any provision in a local act that grants a city the power to exercise extraterritorial planning jurisdiction under Article 19 of Chapter 160A of the General Statutes, or its successor Chapter 160D of the General Statutes, is hereby repealed.



SECTION 5.11.(x)  Subsections (a) through (x) of this section apply only to extraterritorial jurisdiction territory of a city located within the following counties and effective as stated:



(1)        For counties with a population of 25,000 or less according to the last federal decennial census, October 1, 2026.



(2)        For counties with a population between 25,001 and 75,000 according to the last federal decennial census, October 1, 2027.



SECTION 5.11.(y)  No city may expand its extraterritorial jurisdiction beyond the territory that the city was exercising extraterritorial jurisdiction authority upon as of June 1, 2025.



SECTION 5.11.(z)  Cities continuing to exercise extraterritorial jurisdiction authority shall continue to appoint representation on boards in accordance with G.S. 160D‑307.



SECTION 5.11.(aa)  The relinquishment of jurisdiction over an area that a city is regulating under the authority of extraterritorial planning jurisdiction under Article 19 of Chapter 160A of the General Statutes, or its successor Chapter 160D of the General Statutes, shall be determined by the county in which the area lies, not the city which has been exercising extraterritorial jurisdiction over the area, and becomes effective as follows:



(1)        For counties with a population of 25,000 or less according to the last federal decennial census, October 1, 2026.



(2)        For counties with a population between 25,001 and 75,000 according to the last federal decennial census, October 1, 2027.



SECTION 5.11.(bb)  Nothing in this section shall be construed as prohibiting a city from relinquishing jurisdiction over an area prior to the effective date set forth in subsection (aa) of this section so long as the city complies with the provisions of Article 19 of Chapter 160A of the General Statutes, or its successor Chapter 160D of the General Statutes.



SECTION 5.11.(cc)  Upon relinquishment of jurisdiction over an area that a city is regulating under the authority of extraterritorial planning jurisdiction under Article 19 of Chapter 160A of the General Statutes, or its successor Chapter 160D of the General Statutes:



(1)        The city regulations and powers of enforcement shall remain in effect until the earlier of the effective date of the land use regulations adopted by the county with jurisdiction over the area or 60 days after the effective date set forth in subsection (aa) of this section for that county. If the sixtieth day falls on a holiday or weekend, the next business day shall be treated as the sixtieth day. The county may hold hearings and take other measures that may be required in order to adopt county regulations for the area prior to the effective date set forth in subsection (aa) of this section for that county.



(2)        Any person who has acquired vested rights under a permit, certificate, or other evidence of compliance issued by the city may exercise those rights as if no change of jurisdiction had occurred. The county acquiring jurisdiction may take any action regarding the permit, certificate, or other evidence of compliance that could have been taken by the city surrendering jurisdiction pursuant to the city ordinances and regulations. Except as provided in this section, any building, structure, or other land use in a territory over which a county has acquired jurisdiction is subject to the ordinances and regulations of the county. At least 180 days prior to the effective date set forth in subsection (aa) of this section for the county in which any portion of a city lies, the city shall notify the county of the following:



a.         The boundaries of the city's extraterritorial jurisdiction in that county.



b.         The existing land use regulations applying to that extraterritorial jurisdiction in that county, including zoning and overlay maps.



c.         Any pending requests for amendments or other changes to the existing land use regulations applying to that extraterritorial jurisdiction in that county.



d.         Any vested rights with respect to properties in the extraterritorial jurisdiction in that county.



SECTION 5.11.(dd)  Sections 5.10 and 5.11 of this act shall have no effect on the extraterritorial jurisdiction of law enforcement officers as authorized in any of the following:



(1)        Chapter 77 of the General Statutes.



(2)        G.S. 15A‑402.



(3)        G.S. 20‑38.2.



(4)        G.S. 160A‑286.



(5)        Any local act or provision of general law.



SECTION 5.11.(ee)  Except as otherwise provided, Sections 5.9 through 5.11 of this act are effective when they become law.



 



INCREASE PENALTY FOR PARTICIPATING IN PYRAMID DISTRIBUTION PLAN



SECTION 5.12.(a)  G.S. 14‑291.2(a) reads as rewritten:



(a)      No person shall establish, operate, participate in, or otherwise promote any pyramid distribution plan, program, device or scheme whereby by which a participant pays a valuable consideration for the opportunity or chance to receive a fee or compensation upon the introduction of other participants into the program, whether or not such the opportunity or chance is received in conjunction with the purchase of merchandise. A person who that establishes or operates a pyramid distribution plan is guilty of a Class H felony. A person who that participates in or otherwise promotes a pyramid distribution plan is deemed to participate in a lottery and is guilty of a Class 2 misdemeanor.Class 1 misdemeanor.



SECTION 5.12.(b)  This section becomes effective December 1, 2025, and applies to offenses committed on or after that date.



 



REPEAL OBSOLETE ARTICLE



SECTION 5.13.  Article 15A of Chapter 15 of the General Statutes is repealed.



 



REPEAL DUPLICATIVE STATUTE



SECTION 5.14.  G.S. 121‑42 is repealed.



 



MAKE LANGUAGE GENDER-NEUTRAL THROUGHOUT GEOLOGISTS LICENSING ACT



SECTION 5.15.(a)  G.S. 89E‑3 reads as rewritten:



§ 89E‑3.  Definitions.



When used in this Chapter, unless the context otherwise requires:



(1)        Board means the North Carolina Board for Licensing of Geologists.



(2)        Geologist. The term geologist, within the intent of this Chapter, shall mean a person who is trained and educated in the science of geology.



(3)        The term geologist‑in‑training means a person who has taken and successfully passed the portion of professional examination covering fundamental or academic geologic subjects, prior to his completion of the requisite years of experience in geologic work as provided for in required for licensure under this Chapter.



…



(5)        The term good moral character means such character as tends to ensure the faithful discharge of the fiduciary duties of the licensed geologist to his a licensed geologist's fiduciary duties to a client.



…



(8)        Public practice of geology means the performance for others of geological service or work in the nature of work or consultation, investigation, surveys, evaluations, planning, mapping and inspection of geological work, in which the performance is related to the public welfare of safeguarding of life, health, property and the environment, except as specifically exempted by this Chapter. The definition shall not include or allow the practice of engineering as defined in Chapter 89C of the North Carolina General Statutes.



(9)        The term qualified geologist means a person who possesses all of the qualifications specified in this Chapter for licensing except that he or she but is not licensed.



(10)      The term responsible charge of work means the independent control and direction by the use of initiative, skill and independent judgment of geological work or the supervision of such work.



(11)      The term subordinate means either of the following who does not assume the responsible charge of work:



a.         any A person who assists a licensed geologist in the practice of geology without assuming the responsible charge of work.geology.



b.         A geologist‑in‑training working under the supervision of a licensed geologist.



SECTION 5.15.(b)  G.S. 89E‑4 reads as rewritten:



§ 89E‑4.  North Carolina Board for Licensing of Geologists; appointments; terms; composition.



…



(c)        Each member of the Board shall be a citizen of the United States and shall have been a resident of this State for at least six months immediately preceding his or her appointment.appointment to the Board.



….



SECTION 5.15.(c)  G.S. 89E‑6 reads as rewritten:



§ 89E‑6.  Exemptions.



Any person except as specifically exempted below who shall  publicly practice or offer to publicly practice geology in this State is subject to the provisions of this Chapter. The following persons are exempt:



(1)        Persons engaged solely in teaching the science of geology or engaged solely in geologic research in this State may pursue their teaching and/or research without licensing. State. A teacher or researcher must, however, be a licensed geologist if he or she performs to perform geologic work and services for which a licensed geologist license is required by this Chapter.



(2)        Officers and employees of the United States of America and the State of North Carolina practicing solely as such officers or employees.



(3)        Officers and employees of petroleum companies practicing solely as such officers and employees and not offering their  professional services to the public for hire.



(4)        A subordinate to a licensed geologist or a geologist‑in‑training licensed under this Chapter insofar as he or she acts solely  in such when acting solely in that capacity. This exemption does not permit any such a subordinate to practice geology for others in his the subordinate's own right or use the term licensed geologist.



SECTION 5.15.(d)  G.S. 89E‑7 reads as rewritten:



§ 89E‑7.  Limitations.



…



(b)        This Chapter shall not be construed to prevent or to affect:



…



(2)        The public practice of geology by a person not a resident of and having no established place of business in this State, when such the practice does not exceed in the aggregate more than 90 days in any calendar year, and provided such person the nonresident is duly licensed to practice such profession geology in another state where the requirements for a license are not lower than those specified in this Chapter for obtaining the license required for such work; and provided further that such Chapter, the nonresident shall file files with the Board Board, within 10 days of entering this State for commencing of such work, a statement giving his the nonresident's name, residence, residence address, the number of his license, and by what authority issued, and nonresident license number and issuing state, and, upon the completion of the work, files with the Board a statement of the time engaged in such the work within in the State; or



(3)        The public practice of geology by a person who is not a resident of and having has no established place of business in this State, or who State or has recently become a resident hereof, practicing or offering of this State and who practices or offers to practice herein in this State for more than 90 days in any calendar year the profession of geology, if he if the person is licensed in another state or qualified as defined herein, if he shall have state, has filed with the Board an application for a license license, and shall have has paid the fee required by this Chapter. Such A practice shall be under this exemption is deemed a provisional practice and shall continue only for such the time as the Board requires reasonably for the consideration of the applicant for licensing under this Chapter as a geologist.



SECTION 5.15.(e)  G.S. 89E‑8 reads as rewritten:



§ 89E‑8.  Applications.



An application for licensing as a geologist shall be made under oath, shall show the applicant's education and a summary of his the applicant's geological work, plus and shall set out any other relevant criteria to be determined by the Board. The Board shall have the power to determine a reasonable application fee which that shall accompany each application.



SECTION 5.15.(f)  G.S. 89E‑9 reads as rewritten:



§ 89E‑9.  Minimum qualifications.



An applicant shall be eligible for a license as a geologist in North Carolina provided that each applicant meets the following minimum qualifications:



(1)        Be of good moral and ethical character.



(2)        Have graduated from an accredited college or university, and have a degree with a major in geology, engineering geology or geological engineering or related geologic science; or have completed 30 semester hours or the equivalent in geological science courses leading to a major in geology, of which at least 24 hours of the equivalent were upper level undergraduate courses or graduate courses. The Board shall waive the academic requirements for a person already practicing geology at the time this Chapter is enacted, provided application for license is made not later than one year after appointment of the initial Board and provided further that the applicant can provide evidence to satisfy the Board that he or she is competent to engage in the public practice of geology.



(3)        Successfully pass such examination established by the Board which shall be designed to demonstrate that the applicant has the necessary knowledge and requisite skill to exercise the responsibilities of the public practice of geology. The Board shall waive the examination for licensing as a geologist of an applicant who makes written application to the Board not later than one year after appointment of the initial Board, and who otherwise meets the qualification of this Chapter.



(4)        Have at least five years of professional geological work which shall include a minimum of three years of professional geological work under the supervision of a licensed geologist; or a minimum of three cumulative years work in responsible charge of geological work satisfactory to the Board. The following criteria of education and experience qualify as specified toward accumulation of the required five years of professional geological work:



…



d.         The ability of the applicant shall have been demonstrated by his having performed the work in a responsible position as determined by the Board. The adequacy of the required supervision and the experience shall be determined by the Board in accordance with the standards set forth in regulations rules adopted by it.



SECTION 5.15.(g)  G.S. 89E‑11 reads as rewritten:



§ 89E‑11.  Comity.



A person holding a license to engage in the practice of geology, on the basis of comparable licensing requirements issued to him by a proper authority by the State, territory, or possession of the United States or the District of Columbia, and who, in the opinion of the Board otherwise meets the requirements of this Chapter based upon verified evidence may, upon application, be licensed without further examination.



SECTION 5.15.(h)  G.S. 89E‑13 reads as rewritten:



§ 89E‑13.  Seals; requirements.



Each geologist licensed hereunder, under this Chapter, upon the issuance of a license, shall obtain from the secretary at a cost prescribed by the Board, a seal of the design authorized by the Board bearing the licensee's name and the legend Licensed Geologist – State of North Carolina. All drawings, reports reports, or other geologic papers or documents involving geologic work as defined in this Chapter which shall have been that are prepared or approved by a licensed geologist or a subordinate employee under his direction for the use of or geologist, or a nonresident geologist who has been exempted under this Chapter, for delivery to any person or for public record within in this State shall be signed by him or her and impressed with the said seal or the seal of a nonresident practicing under the provisions of this Chapter, either of which shall indicate his or her responsibility therefor.the geologist. The signature and seal each indicate the geologist's responsibility for the papers or documents.



SECTION 5.15.(i)  G.S. 89E‑14 reads as rewritten:



§ 89E‑14.  Records.



(a)        The Board shall keep a public record of its proceedings and a register of all applications for licensing.



(b)        The register shall show:



…



(4)        His or her The applicant's education and other qualifications;



….



SECTION 5.15.(j)  G.S. 89E‑18 reads as rewritten:



§ 89E‑18.  Prohibitions; unlawful acts.



After the effective date of this Chapter:All of the following are unlawful:



(1)        It shall be unlawful for any For a person other than a licensed geologist or a subordinate under his direction to prepare any geologic plans, reports reports, or documents in which the performance is related to the public welfare or safeguarding of life, health, property property, or the environment.



(2)        It shall be unlawful for any For a person to publicly practice, or  offer to publicly practice, geology in this State as defined in the provisions of this Chapter, State, or to use in connection with his or her the person's name or otherwise assume, assume or advertise any title or description tending to convey the impression that he or she the person is a licensed geologist, unless such the person has been duly licensed or exempted under the provisions of this Chapter.



(3)        After one year following the effective date of this act, it shall be unlawful for For anyone other than a geologist licensed  under this Chapter to stamp or seal any plans, plats, reports reports, or other documents with the seal or stamp of a licensed geologist, or to use in any manner the title Licensed Geologist unless that person is licensed hereunder.under this Chapter.



(4)        It shall be unlawful for any For a person to affix his or her signature to or to stamp a licensed geologist's signature, stamp, or seal to any plans, plats, reports, or other documents after the licensing of the person named thereon if the geologist's license has expired or has been suspended or revoked revoked, unless the license has since been renewed or reissued.



SECTION 5.15.(k)  G.S. 89E‑19 reads as rewritten:



§ 89E‑19.  Disciplinary procedures.



…



(b)        If the Board finds that a licensee is professionally incompetent, the Board may require the licensee to take an oral or written examination or to meet other requirements to demonstrate the licensee's fitness to practice geology, and the Board may suspend the licensee's license until he or she the licensee establishes professional competence to the satisfaction of the Board.



….



SECTION 5.15.(l)  G.S. 89E‑22 reads as rewritten:



§ 89E‑22.  Misdemeanor.



Any person who shall willfully practice publicly, or offer to practice publicly, geology for other natural or corporate persons in this State without being licensed in accordance with the provisions of this Chapter, or any person presenting or attempting to use as his own the license or the seal of another, another as the person's own, or any person who shall give any false or forged evidence of any kind in obtaining a license, or any person who shall falsely impersonate any other licensee of like or different name, or any person who shall attempt to use an expired or revoked license or practice at any time during a period the Board has suspended or revoked the license, or any person who shall violate the provisions of this Chapter shall be guilty of a Class 2 misdemeanor.



SECTION 5.15.(m)  G.S. 89E‑24 reads as rewritten:



§ 89E‑24.  Attorney General as legal advisor.



The Attorney General or any assistant or associate in the Department of Justice selected by him the Attorney General shall act as legal advisor to the Board.



 



MAKING LANGUAGE GENDER-NEUTRAL IN CHILD SUPPORT STATUTE



SECTION 5.16.  G.S. 110‑130 reads as rewritten:



§ 110‑130.  Action by the designated representatives of the county commissioners.



(a)        Any A county interested in the paternity and/or or support of a dependent child may institute civil or criminal proceedings commence a civil or criminal action against the responsible parent of the child, child or may take up and pursue intervene in any paternity and/or or support action commenced by the mother, custodian or guardian of the child. Such action shall be undertaken by the concerning the child. The designated representative of the county commissioners in the county where the mother of the child resides or is found, in the county where the father resides or is found, or in the county where the child resides or is found. Any legal proceeding instituted under this section found may commence or intervene in an action under this section. An action commenced under this section may be based upon information or belief.



(b)        The A parent of the child may be subpoenaed for testimony at the trial of the action to establish the paternity of and/or to obtain support for the child either instituted or taken up by the designated representative of the county commissioners. an action commenced or intervened in by a county under this section. The husband‑wife privilege shall not be grounds is not a ground for excusing the mother or father from testifying at the trial nor shall said privilege be grounds is the privilege a ground for the exclusion of confidential communications between husband and wife. If a parent called for examination declines to answer upon the grounds that his ground that his or her testimony may tend to incriminate him, him or her, the court may require him to answer in which event he the parent to answer. The parent shall not thereafter be prosecuted for any criminal act involved in the conception of the child whose paternity is in issue and/or or for whom support is sought, except for perjury committed in this testimony.



 



CONFORMING CHANGE TO FINANCIAL TRANSACTION CARD CRIME ACT



SECTION 5.17.  G.S. 14‑113.7A reads as rewritten:



§ 14‑113.7A.  Application of Article to credit financial transaction cards.



This Article shall not be construed as being applicable does not apply to any credit a financial transaction card as the term is defined in G.S. 14‑113.8.



 



REPEAL OBSOLETE ARTICLE



SECTION 5.18.  Article 3 of Chapter 110 of the General Statutes is repealed.



 



DELETE OBSOLETE REFERENCES TO THE NONCOMMERCIAL LEAKING PETROLEUM UNDERGROUND STORAGE TANK CLEANUP FUND



SECTION 5.19.(a)  All of the following provisions are repealed:



(1)        Subdivision (5) of G.S. 143‑215.94A.



(2)        Subdivisions (b)(6) and (b)(12) of G.S. 143‑215.94B.



(3)        G.S. 143‑215.94F.



(4)        G.S. 143‑215.94P.



SECTION 5.19.(b)  G.S. 143‑215.94A(2), (2a), and (7) read as rewritten:



(2)      Commercial underground storage tank means any one or combination of tanks (including underground pipes connected thereto) used to contain an accumulation of petroleum products, the volume of which (including the volume of the underground pipes connected thereto) is ten percent (10%) or more beneath the surface of the ground. The term commercial underground storage tank does not include any:any of the following:



a.         Farm or residential underground storage tank of 1,100 gallons or less capacity used for storing motor fuel for noncommercial purposes;



b.         Underground storage tank of 1,100 gallons or less capacity used for storing heating oil for consumptive use on the premises where stored;



c.         Underground storage tank of more than 1,100 gallon capacity used for storing heating oil for consumptive use on the premises where stored by four or fewer households;



c1.       Noncommercial underground storage tank.



d.         Septic tank;tank.



e.         Pipeline facility (including gathering lines) regulated under:under any of the following:



1.         The Natural Gas Pipeline Safety Act of 1968 (49 U.S.C. § 1671 et seq.);seq.).



2.         The Hazardous Liquid Pipeline Safety Act of 1979 (49 U.S.C. § 2001 et seq.); orseq.).



3.         Any intrastate pipeline facility regulated under State laws comparable to the provisions of the Natural Gas Pipeline Safety Act of 1968 or the Hazardous Liquid Pipeline Safety Act of 1979;1979.



f.          Surface impoundment, pit, pond, or lagoon;lagoon.



g.         Storm water or waste water collection system;system.



h.         Flow‑through process tank;tank.



i.          Liquid trap or associated gathering lines directly related to oil or gas production and gathering operations; oroperations.



j.          Storage tank situated in an underground area (such as a basement, cellar, mineworking, drift, shaft, or tunnel) if the storage tank is situated upon or above the surface of the floor.



(2a)      Cost‑effective cleanup means the cleanup method that meets all of the following criteria:



a.         Addresses imminent threats to human health or the environment.



b.         Provides for the cleanup or removal of all contaminated soil except in circumstances where it is impractical to remove contaminated soil.



c.         Is approved by the Commission for remediation of the site.



d.         Is the least expensive cleanup based on total cost, including costs not eligible for reimbursement from the Commercial Fund or the Noncommercial Fund.



…



(7)        Noncommercial underground storage tank means any one or combination of the following tanks (including underground pipes connected thereto) used to contain an accumulation of petroleum products, the volume of which (including the volume of the underground pipes connected thereto) is ten percent (10%) or more beneath the surface of the ground. The term noncommercial storage tank does not include any:ground:



a.         Commercial underground storage tanks;



b.         Septic tank;



c.         Pipeline facility (including gathering lines) regulated under:



1.         The Natural Gas Pipeline Safety Act of 1968 (49 U.S.C. § 1671 et seq.);



2.         The Hazardous Liquid Pipeline Safety Act of 1979 (49 U.S.C. § 2001 et seq.); or



3.         Any intrastate pipeline facility regulated under State laws comparable to the provisions of the Natural Gas Pipeline Safety Act of 1968 or the Hazardous Liquid Pipeline Safety Act of 1979;



d.         Surface impoundment, pit, pond, or lagoon;



e.         Storm water or waste water collection system;



f.          Flow‑through process tank;



g.         Liquid trap or associated gathering lines directly related to oil or gas production and gathering operations; or



h.         Storage tank situated in an underground area (such as a basement, cellar, mineworking, drift, shaft, or tunnel) if the storage tank is situated upon or above the surface of the floor.



a.         Farm or residential underground storage tank of 1,100 gallons or less capacity used for storing motor fuel for noncommercial purposes.



b.         Underground storage tank of 1,100 gallons or less capacity used for storing heating oil for consumptive use on the premises where stored.



c.         Underground storage tank of more than 1,100 gallon capacity used for storing heating oil for consumptive use on the premises where stored by four or fewer households.



SECTION 5.19.(c)  G.S. 143‑215.94E reads as rewritten:



§ 143‑215.94E.  Rights and obligations of the owner or operator.



…



(b1)      In the case of a discharge or release from a commercial underground storage tank where the owner and operator cannot be identified or located, or where the owner and operator fail to proceed as required by subsection (a) of this section, the following requirements apply:



(1)        If the current landowner of the land in which the commercial underground storage tank is located notifies the Department in accordance with G.S. 143‑215.85 and undertakes to collect and remove the discharge or release and to restore the area affected in accordance with the requirements of this Article and applicable federal and State laws, regulations, and rules, the current landowner may elect to have the Commercial Fund pay or reimburse the current landowner for any costs described in subdivisions (1), (2), (2a), (3), and (4) of G.S. 143‑215.94B(b) or G.S. 143‑215.94B(b1) that exceed the amounts for which the owner or operator is responsible under that subsection. [The following also apply:]The following provisions also apply:



a.         The current landowner is not eligible for payment or reimbursement until the current landowner has paid the costs described in subdivisions (1), (2), (2a), (3), and (4) of G.S. 143‑215.94B(b) or G.S. 143‑215.94B(b1) for which the owner or operator is responsible.



b.         Eligibility for reimbursement under this subsection may be transferred from a current landowner who has paid the costs described in subdivisions (1), (2), (2a), (3), and (4) of G.S. 143‑215.94B(b) or G.S. 143‑215.94B(b1) to a subsequent landowner.



The current landowner shall submit documentation of all expenditures as required by G.S. 143‑215.94G(b).



…



(e)        When an An owner, operator, or landowner that pays the costs described in G.S. 143‑215.94B(b), 143‑215.94B(b1), or 143‑215.94D(b1) subsection (b) or (b1) of G.S. 143‑215.94B resulting from a discharge or release of petroleum from an a commercial underground storage tank, the owner, operator, or landowner tank may seek reimbursement from the appropriate fund for any costs that the owner, operator, or landowner may elect to have either the Commercial Fund or the Noncommercial Fund pay in accordance with the applicable subsections of this section.



(e1)      The Department may contract for any services necessary to evaluate any claim for reimbursement or compensation from the Commercial Fund, Fund and may contract for any expert witness or consultant services necessary to defend any decision to pay or deny any claim for reimbursement, and reimbursement. The Department may pay the cost of these services from the fund against which the claim is made; provided that in fund. In any fiscal year year, however, the Department shall not expend from either fund more than one percent (1%) of the unobligated balance of the fund on 30 June of the previous fiscal year. The cost of contractual services to evaluate a claim or for expert witness or consultant services to defend a decision with respect to a claim shall be included as costs under G.S. 143‑215.94B(b) and 143‑215.94B(b1).authorized by this subsection are considered costs under subsections (b) and (b1) of G.S. 143‑215.94B.



…



(e5)     (1)        As used in this subsection:



…



b.         Preapproval means a determination by the Department that:



1.         The nature and scope of a task is reasonable and necessary to be performed under G.S. 143‑215.94B(b), 143‑215.94B(b1), or 143‑215.94D(b1) subsection (b) or (b1) of G.S. 143‑215.94B in order to achieve the purposes of this Part.



2.         The amount estimated for the cost of a task does not exceed the amount or rate that is reasonable for that task.



(2)        The Department may require an owner, operator, or landowner to obtain preapproval before proceeding with any task. The Department shall specify those tasks for which preapproval is required. The Department shall deny any request for payment or reimbursement of the cost of any task for which preapproval is required if the owner, operator, or landowner failed to obtain preapproval of the task. Preapproval of a task by the Department does not guarantee payment or reimbursement in the amount estimated for the cost of the task at the time preapproval is requested. The Department shall pay or reimburse the cost of a task only if all of the following apply:



a.         The cost is eligible to be paid under G.S. 143‑215.94B(b), 143‑215.94B(b1), or 143‑215.94D(b1).subsection (b) or (b1) of G.S. 143‑215.94B.



b.         Payment is in accordance with G.S. 143‑215.94B(d) or G.S. 143‑215.94D(d).G.S. 143‑215.94B(d).



c.         The Department determines that the cost is reasonable and necessary.



(3)        The Commission may adopt rules governing payment or reimbursement of reasonable and necessary costs and, consistent with any rules adopted by the Commission, the Department shall develop, implement, and periodically revise a schedule of costs that the Department determines to be reasonable and necessary costs for specific tasks. Statements that specify tasks for which preapproval is required and schedules of reasonable and necessary costs for specific tasks are statements within the meaning of G.S. 150B‑2(8a)g. This subsection shall not be construed to does not invalidate any rule of the Commission related to preapproval of tasks that will result in a cost that is eligible to be paid or reimbursed under G.S. 143‑215.94B(b), 143‑215.94B(b1), or 143‑215.94D(b1), provided, however, that the subsection (b) or (b1) of G.S. 143‑215.94B. The Department may specify additional tasks for which preapproval is required.required in addition to any specified by the Commission.



(4)        In all cases, the Department shall require an owner, operator, or landowner to submit documentation sufficient to establish that a claim is eligible to be paid or reimbursed under this Part before the Department pays or reimburses the claim.



(5)        The Department shall authorize a task the cost of which is to be paid or reimbursed from the Commercial Fund or the Noncommercial Fund only when the task is scheduled to be performed on the basis of a priority determination pursuant to subsection (e4) of this section. The Department shall not pay or reimburse the cost of any task for which authorization is required under this subsection until the Department has preapproved and authorized the task.



(6)        Except as provided in subdivisions (8) and (9) of this subsection, the Department shall not authorize any task the cost of which is to be paid or reimbursed from the Commercial Fund or the Noncommercial Fund unless the Department determines, based on the scope of the work to be performed and the schedule of reasonable and necessary costs, that sufficient funds will be available in the Commercial Fund or the Noncommercial Fund, whichever applies, to pay or reimburse the cost of that task within 90 days after the Department determines that the owner, operator, or landowner has submitted a claim with documentation sufficient to establish that the claim is eligible to be paid under this Part.



…



(8)        The Department may preapprove and authorize a task the cost of which is to be paid or reimbursed for payment or reimbursement from the Commercial Fund or the Noncommercial Fund a task that has not been authorized pursuant to subdivisions (5) and (6) of this subsection if the owner, operator, or landowner specifically requests that the task be authorized and agrees that the claim for payment or reimbursement of the task's cost will not be paid until after the Department has paid all claims for payment or reimbursement of costs for tasks that the Department has authorized pursuant to subdivisions (5) and (6) of this subsection.



(9)        The Department may preapprove and authorize a task the cost of which is to be paid or reimbursed for payment or reimbursement from the Commercial Fund or the Noncommercial Fund a task that has not been authorized pursuant to subdivisions (5) and (6) of this subsection if the discharge or release creates an emergency situation. An emergency situation exists when a discharge or release of petroleum results in an imminent threat to human health or the environment. A claim for payment or reimbursement of costs for tasks that are authorized under this subdivision shall be paid or reimbursed on the same basis as tasks that are authorized under subdivisions (5) and (6) of this subsection.



…



(g)        No owner or operator shall be reimbursed pursuant to this section, and the Department shall seek reimbursement of the appropriate fund Commercial Fund or of the Department for any monies disbursed from the appropriate fund Commercial Fund or expended by the Department if any of the following apply:



(1)        The owner or operator has willfully violated any substantive law, rule, or regulation applicable to underground storage tanks and intended to prevent or mitigate discharges or releases or to facilitate the early detection of discharges or releases.



(2)        The discharge or release is the result of the owner's or operator's willful or wanton misconduct.



(3)        The owner or operator has failed to pay any annual tank operating fee due pursuant to G.S. 143‑215.94C.



…



(j)         An owner, operator, or landowner shall request that the Department determine whether any of the costs of assessment and cleanup of a discharge or release from a petroleum underground storage tank are eligible to be paid or reimbursed from either the Commercial Fund within one year after completion of any task that is eligible to be paid or reimbursed under G.S. 143‑215.94B(b) or 143‑215.94B(b1).



….



SECTION 5.19.(d)  G.S. 143‑215.94G, as amended by Section 5.35(l) of this act, reads as rewritten:



§ 143‑215.94G.  Authority of the Department to engage in cleanups; actions for fund reimbursement.



(a)        If there is a discharge or release of petroleum from any of the following, the Department may use staff, equipment, or materials under its control or provided by other cooperating federal, State, or local agencies and may contract with any agent or contractor it deems appropriate to investigate a release, to develop and implement a cleanup plan, to provide interim alternative sources of drinking water to third parties, and to pay the initial costs for providing permanent alternative sources of drinking water to third parties:



(1)        A noncommercial underground storage tank.



(2)        An underground storage tank whose owner or operator cannot be identified or located.



(3)        An underground storage tank whose owner or operator fails to proceed as required by G.S. 143‑215.94E(a).



(4)        A commercial underground storage tank taken out of operation prior to 1 January 1974 if, when the discharge or release is discovered, neither the owner nor operator owns or leases the land on which the underground storage tank is located.



…



(d)       The Secretary shall seek reimbursement through any legal means available for the following:



…



(6)        The amounts provided for in G.S. 143‑215.94B(b5) and G.S. 143‑215.94D(b2).G.S. 143‑215.94B(b5).



(e)        In the event that a civil action is commenced to secure reimbursement pursuant to subdivisions (1) through (4) of subsection (d) of this section, the Secretary may recover, in addition to any amount due, the costs of the action, including but not limited to reasonable attorneys' fees and investigation expenses. Any monies received or recovered as reimbursement shall be paid into the appropriate fund Commercial Fund or other source from which the expenditures were made.



(f)        Repealed by Session Laws 2015‑241, s. 14.16A(f), effective December 31, 2016.



(g)        If the Department paid or reimbursed costs that are not authorized to be paid or reimbursed under G.S. 143‑215.94B or G.S. 143‑215.94D as a result of a misrepresentation by an agent that acted on behalf of an owner, operator, or landowner, the Department shall first seek reimbursement, pursuant to subdivision (1) of subsection (d) of this section, from the agent of monies paid to or retained by the agent.



….



SECTION 5.19.(e)  G.S. 143‑215.94V reads as rewritten:



§ 143‑215.94V.  Standards for petroleum underground storage tank cleanup.



(a)        Legislative findings and intent.



(1)        The General Assembly finds that:



a.         The goals of the underground storage tank program are to protect human health and the environment. Maintaining the solvency of the Commercial Fund and the Noncommercial Fund is essential to these goals.



…



(2)        The General Assembly intends:



…



e.         That neither the Commercial Fund nor the Noncommercial Fund not be used to clean up sites where the Commission has determined that a discharge or release poses a degree of risk to human health or the environment that is no greater than the acceptable level of risk established by the Commission.



f.          Repealed by Session Laws 1998‑161, s. 11(c), effective retroactively to January 1, 1998.



g.         That the Commercial Fund and the Noncommercial Fund be used to perform the most cost‑effective cleanup that addresses imminent threats to human health and the environment.



…



(c)        The Commission may require an owner or operator or a landowner eligible for payment or reimbursement under subsections (b), (b1), (c), and (c1) subsections (b) and (b1) of G.S. 143‑215.94E to provide information necessary to determine the degree of risk to human health and the environment that is posed by a discharge or release from a petroleum underground storage and to identify the most cost‑effective cleanup that addresses imminent threats to human health and the environment.



…



(e)        If the Commission concludes under subsection (d) of this section that no cleanup, no further cleanup, or no further action will be required, the Department shall not pay or reimburse any costs otherwise payable or reimbursable under this Article from either the Commercial or Noncommercial Fund, other than reasonable and necessary to conduct the risk assessment required by this section, unless:



(1)        Cleanup is ordered or damages are awarded in a finally adjudicated judgment in an action against the owner or landowner. To be eligible for reimbursement of damages arising from a third‑party claim for bodily injury or property damage awarded in a finally adjudicated judgment, however, an owner or operator shall (i) notify the Department of any such claim; (ii) provide the Department with all pleadings and other related documents if a lawsuit has been filed; and (iii) provide the Department copies of any medical reports, statements, investigative reports, or certifications from licensed professionals necessary to determine that a claim for bodily injury or property damage is reasonable and necessary. Reimbursement of claims for damages arising from a third‑party claim for bodily injury or property damage awarded in a finally adjudicated judgment shall be subject to the limitations set forth in G.S. 143‑215.94B(b)(5) and G.S. 143‑215.94D(b1)(2), as applicable, G.S. 143‑215.94B(b)(5) and any other provision governing third‑party claims set forth in this Article.



…



(e1)      If the Commission concludes under subsection (d) of this section that further cleanup is required and notifies the owner, operator, or landowner of the cleanup method approved by the Commission as the most cost‑effective cleanup method for the site, the Department shall not pay or reimburse any costs otherwise payable or reimbursable under this Article from either the Commercial Fund or Noncommercial Fund, other than those costs that are reasonable and necessary to conduct the risk assessment and to implement the cost‑effective cleanup method approved by the Commission. If the owner, operator, or landowner selects a cleanup method other than the one identified by the Commission as the most cost‑effective cleanup, the Department shall not pay or reimburse for costs in excess of the cost of implementing the approved cost‑effective cleanup.



…



(h)        If a discharge or release of petroleum from an underground storage tank results in contamination in soil or groundwater that becomes commingled with contamination that is the result of a discharge or release of petroleum from a source of contamination other than an underground storage tank, the cleanup of petroleum may proceed under rules adopted pursuant to this section. The Department shall not pay or reimburse from the Commercial Fund any costs associated with the assessment or remediation of that portion of contamination that results from a release or discharge of petroleum from a source other than an underground storage tank from either the Commercial Fund or the Noncommercial Fund.tank.



SECTION 5.19.(f)  G.S. 143B‑426.40A(l) reads as rewritten:



(l)       Assignment of Payments From the Underground Storage Tank Cleanup Funds. – Payments from Commercial Fund. – This section does not apply to an assignment of any claim for payment or reimbursement from the Commercial Leaking Petroleum Underground Storage Tank Cleanup Fund established by G.S. 143‑215.94B or the Noncommercial Leaking Petroleum Underground Storage Tank Cleanup Fund established by G.S. 143‑215.94D.G.S. 143‑215.94B.



 



UPDATE OBSOLETE REFERENCES AND OTHER CONFORMING CHANGES IN ADMINISTRATIVE LAW



SECTION 5.20.(a)  G.S. 150B‑37(c) is recodified as the last sentence of G.S. 150B‑34(a).



SECTION 5.20.(b)  G.S. 150B‑34, as amended by subsection (a) of this section, reads as rewritten:



§ 150B‑34.  Final decision or order.



(a)        In each contested case the administrative law judge shall make a final decision or order that contains findings of fact and conclusions of law. The administrative law judge shall decide the case based upon the preponderance of the evidence, giving due regard to the demonstrated knowledge and expertise of the agency with respect to facts and inferences within the specialized knowledge of the agency. The Office of Administrative Hearings shall forward a copy of the administrative law judge's final decision or order to each party.



(b)        Repealed by Session Laws 1991, c. 35, s. 6.



(c)        Repealed by Session Laws 2011‑398, s. 18. For effective date and applicability, see editor's note.



(d)       Except for the exemptions contained in G.S. 150B‑1, the provisions of this section regarding the decision of the administrative law judge shall apply only to agencies subject to Article 3 of this Chapter, notwithstanding any other provisions to the contrary relating to recommended decisions by administrative law judges.



….



SECTION 5.20.(c)  G.S. 90A‑30 reads as rewritten:



§ 90A‑30.  Penalties; remedies; contested cases.



(a)        Upon the recommendation of the Board of Certification, the Secretary of Environmental Quality or a delegated representative may impose an administrative, civil penalty on any person, corporation, company, association, partnership, unit of local government, State agency, federal agency, or other legal entity who that violates G.S. 90A‑29(a). Each day of a continued violation shall constitute constitutes a separate violation. The penalty shall not exceed one hundred dollars ($100.00) for each day such the violation continues. No penalty shall be assessed until the person alleged to be in violation has been notified of the violation.



The clear proceeds of penalties imposed pursuant to this section shall be remitted to the Civil Penalty and Forfeiture Fund in accordance with G.S. 115C‑457.2.



(b)        Any person wishing to contest a penalty issued under this section shall be is entitled to an administrative hearing and judicial review conducted according to the procedures outlined in Articles 3 and 4 of Chapter 150B of the General Statutes.



(c)        The Secretary may bring a civil action in the superior court of the county in which the violation is alleged to have occurred to recover the amount of the administrative penalty whenever if either of the following applies to an owner or person in control of a water treatment facilityfacility:



(1)        Who The owner or person has not requested an administrative hearing and fails to pay the penalty within 60 days after being notified of such penalty, orthe penalty.



(2)        Who The owner or person has requested an administrative hearing and fails to pay the penalty within 60 days after service of the Office of Administrative Hearings forwards a written copy of the decision as provided in G.S. 150B‑36.G.S. 150B‑34.



(d)       Notwithstanding any other provision of law, this section imposes the only penalty or sanction, civil or criminal, for violations of G.S. 90A‑29(a) or for the failure to meet any other legal requirement for a water system to have a certified operator in responsible charge.



SECTION 5.20.(d)  G.S. 104E‑24 reads as rewritten:



§ 104E‑24.  Administrative penalties.



(a)        The Department may impose an administrative penalty on any person:a person that does either of the following:



(1)        Who fails Fails to comply with this Chapter, any order issued hereunder, under it, or any rules adopted pursuant to this Chapter;it.



(2)        Who refuses Refuses to allow an authorized representative of the Radiation Protection Commission or the Department of Health and Human Services a right of entry as provided for in G.S. 104E‑11 or impounding materials as provided for in G.S. 104E‑14.



(b)        Each day of a continuing violation shall constitute constitutes a separate violation. Such The penalty shall not exceed ten thousand dollars ($10,000) per day. In determining the amount of the penalty, the Department shall consider the degree and extent of the harm caused by the violation. Any person assessed a penalty shall be notified of the assessment by registered or certified mail, and the notice shall specify the reasons for the assessment.



(c)        Any person wishing to contest a penalty or order issued under this section shall be is entitled to an administrative hearing and judicial review in accordance with the procedures outlined in Articles 3, 3A, 3 and 4 of Chapter 150B of the General Statutes.



(d)       The Secretary may bring a civil action in the superior court of the county in which such the violation is alleged to have occurred to recover the amount of the administrative penalty whenever a person:if either of the following applies:



(1)        Who The person has not requested an administrative hearing and fails to pay the penalty within 60 days after being notified of such penalty, orthe penalty.



(2)        Who The person has requested an administrative hearing and fails to pay the penalty within 60 days after service of the Office of Administrative Hearings forwards a written copy of the decision as provided in G.S. 150B‑36.G.S. 150B‑34.



(e)        The clear proceeds of penalties imposed pursuant to this section shall be remitted to the Civil Penalty and Forfeiture Fund in accordance with G.S. 115C‑457.2.



SECTION 5.20.(e)  G.S. 108A‑70.9A(f) reads as rewritten:



(f)       Final Decision. – After a hearing before an administrative law judge, the judge OAH shall return forward a written copy of the administrative law judge's decision to the Department and the recipient in accordance with G.S. 150B‑37. G.S. 150B‑34. The Department decision shall notify the Department and the recipient of the final decision and of the right to judicial review of the decision pursuant to Article 4 of Chapter 150B of the General Statutes.



SECTION 5.20.(f)  G.S. 108A‑70.9B(g) reads as rewritten:



(g)      Decision. – The administrative law judge assigned to a contested Medicaid case shall hear and decide the case without unnecessary delay. The judge shall prepare a written decision and send shall forward a copy of it to the parties in accordance with G.S. 150B‑37.G.S. 150B‑34.



SECTION 5.20.(g)  G.S. 108D‑16 reads as rewritten:



§ 108D‑16.  Notice of final decision and right to seek judicial review.



The administrative law judge assigned to conduct a contested case hearing under G.S. 108D‑15 shall hear and decide the case without unnecessary delay. The judge shall prepare a written decision that includes findings of fact and conclusions of law and send shall forward a copy of it to the parties in accordance with G.S. 150B‑37. G.S. 150B‑34. The written decision shall notify the parties of the final decision and of the right of the enrollee and the managed care entity to seek judicial review of the decision under Article 4 of Chapter 150B of the General Statutes.



SECTION 5.20.(h)  G.S. 122C‑24 reads as rewritten:



§ 122C‑24.  Adverse action on a license.



(a)        The Secretary may deny, suspend, amend, or revoke a license in any case in which the Secretary finds that there has been a substantial failure to comply with any provision of this Article or other applicable statutes or any applicable rule adopted pursuant to these statutes. Action[s] Actions under this section and appeals of those actions shall be in accordance with rules of the Commission and Chapter 150B of the General Statutes.



(b)        When an appeal is filed concerning the denial, suspension, amendment, or revocation of a license, a copy of the proposal for decision shall be sent to the Chairman of the Commission in addition to the parties specified in G.S. 150B‑34. The Chairman or members of the Commission designated by the Chairman may submit for the Secretary's consideration written or oral comments concerning the proposal prior to the issuance of a final agency decision in accordance with G.S. 150B‑36.



SECTION 5.20.(i)  G.S. 122C‑24.1 reads as rewritten:



§ 122C‑24.1.  Penalties; remedies.



…



(h)        The Secretary may bring a civil action in the superior court of the county wherein where the violation occurred to recover the amount of the administrative penalty whenever if either of the following applies to a facility:



(1)        Which The facility has not requested an administrative hearing and fails to pay the penalty within 60 days after being notified of the penalty, orpenalty.



(2)        Which The facility has requested an administrative hearing and fails to pay the penalty within 60 days after receipt of the Office of Administrative Hearings forwards a written copy of the decision as provided in G.S. 150B‑37.G.S. 150B‑34.



…



(j)         The clear proceeds of civil penalties provided for in this section shall be remitted to the State Treasurer for deposit Civil Penalty and Forfeiture Fund in accordance with State law.G.S. 115C‑457.2.



….



SECTION 5.20.(j)  G.S. 131D‑34 reads as rewritten:



§ 131D‑34.  Penalties; remedies.



…



(g)        The Secretary may bring a civil action in the superior court of the county wherein where the violation occurred to recover the amount of the administrative penalty whenever if either of the following applies to a facility:



(1)        Which The facility has not requested an administrative hearing and fails to pay the penalty within 60 days after being notified of the penalty, orpenalty.



(2)        Which The facility has requested an administrative hearing and fails to pay the penalty within 60 days after receipt of the Office of Administrative Hearings forwards a written copy of the decision as provided in G.S. 150B‑36.G.S. 150B‑34.



…



(i)         The clear proceeds of civil penalties provided for in this section shall be remitted to the State Treasurer for deposit Civil Penalty and Forfeiture Fund in accordance with State law.G.S. 115C‑457.2.



SECTION 5.20.(k)  G.S. 131E‑129(f) reads as rewritten:



(f)       The Secretary may bring a civil action in the superior court of the county wherein where the violation occurred to recover the amount of the administrative penalty whenever if either of the following applies to a facility:



(1)        Which The facility has not requested an administrative hearing and fails to pay the penalty within 60 days after being notified of the penalty; orpenalty.



(2)        Which The facility has requested an administrative hearing and fails to pay the penalty within 60 days after receipt of the Office of Administrative Hearings forwards a written copy of the decision as provided in G.S. 150B‑36.G.S. 150B‑34.



SECTION 5.20.(l)  G.S. 143‑215.94G reads as rewritten:



§ 143‑215.94G.  Authority of the Department to engage in cleanups; actions for fund reimbursement.



(a)        The If there is a discharge or release of petroleum from any of the following, the Department may use staff, equipment, or materials under its control or provided by other cooperating federal, State, or local agencies and may contract with any agent or contractor it deems appropriate to investigate a release, to develop and implement a cleanup plan, to provide interim alternative sources of drinking water to third parties, and to pay the initial costs for providing permanent alternative sources of drinking water to third parties, and shall pay the costs resulting from the Commercial Fund whenever there is a discharge or release of petroleum from any of the following:parties:



(1)        A noncommercial underground storage tank.



(2)        An underground storage tank whose owner or operator cannot be identified or located.



(3)        An underground storage tank whose owner or operator fails to proceed as required by G.S. 143‑215.94E(a).



(4)        A commercial underground storage tank taken out of operation prior to 1 January 1974 if, when the discharge or release is discovered, neither the owner nor operator owns or leases the land on which the underground storage tank is located.



(a1)      Every State agency shall provide to the Department to the maximum extent feasible such any staff, equipment, and materials as may be that are available and useful to the development and implementation of a cleanup program.



(a2)      The cost of any action authorized under subsection (a) of this section shall be paid, to the extent funds are available, from the following sources in the order listed:



(1)        Any funds to which the State is entitled under any federal program providing for the cleanup of petroleum discharges or releases from underground storage tanks, including, but not limited to, the Leaking Underground Storage Tank Trust Fund established pursuant to 26 U.S.C. § 4081 and 42 U.S.C. § 6991b(h).



(2)        The Commercial Fund.



(a3)      Expired October 1, 2011, pursuant to Session Laws 2001‑442, s. 8, as amended by Session Laws 2008‑195, s. 11.



(b)        Whenever the discharge or release of a petroleum product is from a commercial underground storage tank, the Department may supervise the cleanup of environmental damage required by G.S. 143‑215.94E(a). If the owner or operator elects to have the Commercial Fund reimburse or pay for any costs allowed under subsection (b) or (b1) of G.S. 143‑215.94B, the Department shall require the owner or operator to submit documentation of all expenditures claimed for the purposes of establishing that the owner or operator has spent the amounts required to be paid by the owner or operator pursuant to and in accordance with G.S. 143‑215.94E(b). The Department shall allow credit for all expenditures that the Department determines to be reasonable and necessary. The Department may shall not pay for any costs for which the Commercial Fund was established until the owner or operator has paid the amounts specified in G.S. 143‑215.94E(b).



(c)        The Secretary shall keep a record of all expenses incurred for the services of State personnel and for the use of the State's equipment and material.



(d)       The Secretary shall seek reimbursement through any legal means available, for:available for the following:



(1)        Any costs not authorized to be paid from the Commercial Fund;Fund.



(2)        The amounts provided for in G.S. 143‑215.94B(b) or G.S. 143‑215.94B(b1) required to be paid for by the owner or operator pursuant to G.S. 143‑215.94E(b) where if the owner or operator of a commercial underground storage tank is later identified or located;located.



(3)        The amounts provided for in G.S. 143‑215.94B(b) or G.S. 143‑215.94B(b1) required to be paid for by the owner or operator pursuant to G.S. 143‑215.94E(b) where if the owner or operator of a commercial underground storage tank failed to proceed as required by G.S. 143‑215.94E(a);G.S. 143‑215.94E(a).



(3a)      The amounts provided for by G.S. 143‑215.94B(b)(5) required to be paid by the owner or operator to third parties for the cost of providing interim alternative sources of drinking water to third parties and the initial cost of providing permanent alternative sources of drinking water to third parties;parties.



(4)        Any funds due under G.S. 143‑215.94E(g); andG.S. 143‑215.94E(g).



(5)        Any funds to which the State is entitled under any federal program providing for the cleanup of petroleum discharges or releases from underground storage tanks; [and]tanks.



(6)        The amounts provided for in G.S. 143‑215.94B(b5) and G.S. 143‑215.94D(b2).



(e)        In the event that a civil action is commenced to secure reimbursement pursuant to subdivisions (1) through (4) of subsection (d) of this section, the Secretary may recover, in addition to any amount due, the costs of the action, including but not limited to reasonable attorney's attorneys' fees and investigation expenses. Any monies received or recovered as reimbursement shall be paid into the appropriate fund or other source from which the expenditures were made.



(f)        Repealed by Session Laws 2015‑241, s. 14.16A(f), effective December 31, 2016.



(g)        If the Department paid or reimbursed costs that are not authorized to be paid or reimbursed under G.S. 143‑215.94B or G.S. 143‑215.94D as a result of a misrepresentation by an agent who that acted on behalf of an owner, operator, or landowner, the Department shall first seek reimbursement, pursuant to subdivision (1) of subsection (d) of this section, from the agent of monies paid to or retained by the agent.



(h)        The Department shall take administrative action to recover costs or bring a civil action pursuant to subdivision (1) of subsection (d) of this section to seek reimbursement of costs in accordance with the time limits set out in this subsection.following time limits:



(1)        The Department shall take administrative action to recover costs or bring a civil action to seek reimbursement of costs that are not authorized to be paid from the Commercial Fund under subdivision (1), (2), or (3) of G.S. 143‑215.94B(d) within five years after payment.



(2)        The Department shall take administrative action to recover costs or bring a civil action to seek reimbursement of costs other than those described in subdivision (1) of this subsection within three years after payment.



(3)        Notwithstanding the time limits set out in subdivisions (1) and (2) of this subsection, the Department may take administrative action to recover costs or bring a civil action to seek reimbursement of costs paid as a result of fraud or misrepresentation at any time.



(i)         An administrative action or civil action that is not commenced within the time allowed by subsection (h) of this section is barred.



(j)         Except with the consent of the claimant, the Department may shall not withhold payment or reimbursement of costs that are authorized to be paid from the Commercial Fund in order to recover any other costs that are in dispute unless the Department is authorized to withhold payment by a final decision of the Commission pursuant to G.S. 150B‑36 in a contested case under Article 3 of Chapter 150B of the General Statutes or by an order or final decision of a court.



 



REPEAL OBSOLETE ARTICLE



SECTION 5.21.  Article 29A of Chapter 143 of the General Statutes is repealed.



 



PART V-A. HELENE RELATED FUNDING AND FLEXIBILITY



 



HELENE RELATED FUNDING: COMPETITIVE GRANT PRIORITIZATION



SECTION 5A.1.(a)  Notwithstanding any other provision of law, for the 2025‑2027 fiscal biennium, the following programs and funds, which collectively represent over seven hundred fifty million dollars ($750,000,000) in the base budget from competitive grant programs over the biennium, shall prioritize applicants from counties that (i) were designated, in whole or in part, by the United States Department of Housing and Urban Development as the most impacted and distressed counties from Hurricane Helene and (ii) have a population of 300,000 or fewer based upon the 2023 Certified County Population Estimates from the State Demographer:



(1)        Needs‑Based Public School Capital Fund, established in Article 38B of Chapter 115C of the General Statutes. The matching requirement under G.S. 115C‑546.11 is waived for applicants qualifying under this subsection for prioritization.



(2)        Community Health Grant Program administered by the Department of Health and Human Services, Division of Central Management, Office of Rural Health (Rural Health).



(3)        State‑Designated Rural Health Centers Support Grant Program and Rural Health Capital Grants Program administered by Rural Health.



(4)        Agricultural Water Resources Assistance Program, established under Article 5 of Chapter 139 of the General Statutes.



(5)        Utility Account, established under G.S. 143B‑437.01.



(6)        Rural Engagement & Investment Program under the Department of Commerce, Rural Economic Development Division.



(7)        Parks and Recreation Trust Fund, established under G.S. 143B‑135.56.



(8)        North Carolina Land and Water Fund, established under G.S. 143B‑135.234.



(9)        Grants administered by the North Carolina Arts Council, established under Part 14 of Article 2 of Chapter 143B of the General Statutes.



(10)      Grants awarded by the State Water Infrastructure Authority from the State Drinking Water and Wastewater Reserves.



SECTION 5A.1.(b)  Each agency overseeing the administration of funds from the programs and funds listed in subsection (a) of this section shall require applicants seeking prioritization to attest that (i) the application for funds is for repair, replacement, or construction of equipment, buildings, or natural features due to damage or effects from Hurricane Helene, including capacity‑building, and (ii) the amount of funds requested is the amount of unmet need above the amount paid by insurance and available federal aid.



 



Helene related funding: State agencies Operations



SECTION 5A.2.  In order to augment State funds that are available for operational needs of various State agencies resulting from recovery and relief efforts related to damage and suffering caused by Hurricane Helene, the General Assembly has identified and transferred to the Helene Fund funds from other reserves, in the amount of seven hundred million dollars ($700,000,000), that are currently unutilized or underutilized and has used a portion of those funds for multiple agencies, as provided elsewhere in this act, including the North Carolina Community College System, the Department of Commerce, the Office of the Governor, and The University of North Carolina.



 



HELENE RELATED FUNDING: SEWER/WATER



SECTION 5A.3.  The General Assembly finds that the supplemental appropriations provided by Congress in the American Relief Act of 2025 (P.L. 118‑158) and allocated by the U.S. Environmental Protection Agency to the Clean Water State Revolving Fund and the Drinking Water State Revolving Fund for wastewater treatment works, drinking water facilities, and decentralized wastewater treatment systems in the State impacted by Hurricane Helene should be expeditiously used for repair and replacement of drinking water and wastewater infrastructure damaged by Hurricane Helene.



Accordingly, the General Assembly has appropriated in this act for the 2025‑2026 fiscal year the sum of six hundred eighty‑five million six hundred thirteen thousand dollars ($685,613,000) in federal disaster funding in this act, which is allocated in and for the following amounts and uses:



(1)        Two hundred fifty‑three million six hundred eighty‑one thousand dollars ($253,681,000) to the Clean Water State Revolving Fund established in G.S. 159G‑22(b) (CWSRF) and four hundred nine million four hundred twenty‑two thousand dollars ($409,422,000) to the Drinking Water State Revolving Fund established in G.S. 159G‑22(c) (DWSRF) for funding of projects consistent with applicable federal law and guidance to CWSRF and DWSRF eligible entities that were damaged, can demonstrate impact, or experienced a loss or disruption of a mission‑essential function caused by Hurricane Helene.



(2)        Twenty‑two million five hundred ten thousand dollars ($22,510,000) to the CWSRF to improve the resilience of decentralized wastewater treatment systems to flooding, to assess the potential to connect homes served by decentralized wastewater treatment systems to centralized wastewater systems, and to fund such connections.



 



Helene Related Funding: Transportation



SECTION 5A.4.  In order to augment State funds that are available for needs resulting from recovery and relief efforts related to damage and suffering caused by Hurricane Helene, the General Assembly is identifying and reallocating transportation funds that are unutilized or underutilized to meet the cash flow and federal matching requirements for transportation infrastructure recovery in Helene impacted counties. To this end, as otherwise provided in this act, the General Assembly has identified six hundred thirty‑three million six hundred thirty‑nine thousand six hundred thirty dollars ($633,639,630) in Part XLIII of this act for reallocation for uses consistent with the Highway Fund and this act.



 



HELENE RELATED FUNDING: PUBLIC SCHOOL CAPITAL



SECTION 5A.5.  The State Controller shall transfer interest earned as of June 30, 2025, from the Needs‑Based Public School Capital Fund established in Article 38B of Chapter 115C of the General Statutes, estimated at thirty‑nine million six hundred thousand dollars ($39,600,000), to the Department of Public Instruction for Capital Recovery Funds for the Public School Facilities Program, established in S.L. 2024‑53, Committee Report, page F2, Item 7.



 



Emergency Flexibility of Funds



SECTION 5A.6.  G.S. 166A‑19.40 reads as rewritten:



§ 166A‑19.40.  Use of contingency and emergency funds.



(a)        Use of Contingency and Emergency Funds. – The Governor may use contingency and emergency funds:



(1)        As necessary and appropriate to provide relief and assistance from the effects of an emergency.



(2)        As necessary and appropriate for National Guard training in preparation for emergencies with the concurrence of the Council of State.



(b)        Repealed by Session Laws 2015‑241, s. 6.19(a), effective July 1, 2015.



(c)        Use of Other Funds. – The Governor may reallocate on a nonrecurring basis such other funds as may reasonably be available within the appropriations of the various departments when all of the following conditions are satisfied:



(1)        The severity and magnitude of the emergency so requires.



(2)        Contingency and emergency funds are insufficient or inappropriate.



(3)        A state of emergency has been declared pursuant to G.S. 166A‑19.20(a).



(4)        Funds in the State Emergency Response and Disaster Relief Fund are insufficient.



 



PART VI. COMMUNITY COLLEGE SYSTEM



 



Institutional Support Consolidation



SECTION 6.1.(a)  The State Board of Community Colleges shall consolidate administrative functions held across the community colleges system into a new administrative structure. The President of the Community Colleges System, a consultant hired by the State Board, or individual community colleges may submit recommendations to the State Board, but all decision‑making power on the development of the new structure resides with the State Board. The new structure developed pursuant to this section shall go into effect beginning with the 2026‑2027 academic year. The State Board may use up to two million dollars ($2,000,000) in nonrecurring funds appropriated in this act for the 2025‑2026 fiscal year for the following:



(1)        To contract with a third‑party consultant to assist with development of the new administrative structure.



(2)        To conduct studies related to developing the new administrative structure.



(3)        Other purposes the State Board deems relevant to developing the new administrative structure.



SECTION 6.1.(b)  The State Board shall submit a report to the Joint Legislative Education Oversight Committee on the administrative structure developed pursuant to this section no later than April 15, 2026. The report shall include at least the following:



(1)        An overview of the new structure compared to the prior structure.



(2)        A summary of efficiencies achieved by the new structure.



 



Repeal MINORITY MALE SUCCESS INITIATIVE REPORT



SECTION 6.2.  G.S. 115D‑58.17(a) reads as rewritten:



(a)      No later than February 15, 2024, and annually thereafter, the State Board of Community Colleges shall report to the Joint Legislative Education Oversight Committee on outcomes related to the following recurring programs:



(1)        Minority male mentoring programs, including the Minority Male Success Initiative.



(2)        The the Rowan‑Cabarrus Community College Biotechnology Training Center and Greenhouse at the North Carolina Research Campus in Kannapolis.



 



PROPEL NC



SECTION 6.3.(a)  The following session laws are repealed:



(1)        Subsection (b) of Section 8.3 of S.L. 2011‑145.



(2)        Subsection (a) of Section 10.4 of S.L. 2013‑360.



SECTION 6.3.(b)  The State Board of Community Colleges shall revise its funding formula for community colleges and allocate funds under that revised formula, beginning with the 2025‑2026 fiscal year, according to the following minimum criteria:



(1)        Each community college shall continue to receive a base allocation of funds.



(2)        In addition to the base allocation of funds, funds shall be provided to community colleges based on the number of full‑time equivalent (FTE) students enrolled in curriculum, workforce continuing education, and Basic Skills courses.



(3)        Funds allocated pursuant to subdivision (2) of this subsection shall be weighted based on the workforce sector of each course, as determined by the State Board. In making its determinations, the State Board shall consider salary data and labor market demand for the applicable workforce sector.



SECTION 6.3.(c)  Part 3 of Article 1 of Chapter 115D of the General Statutes, as enacted by this act, is further amended by adding a new section to read:



§ 115D‑10.55.  Course review.



The State Board of Community Colleges shall review and revise, as necessary, its workforce sector designations for curriculum, workforce continuing education, and Basic Skills courses at community colleges by July 15, 2028, and every three years thereafter.



SECTION 6.3.(d)  Of the funds appropriated for the purposes of this section, the State Board of Community Colleges shall increase funding for pathways related to healthcare, engineering and advanced manufacturing, trades and transportation, and information technology.



SECTION 6.3.(e)  No later than April 1, 2027, the Community Colleges System Office shall report to the Joint Legislative Education Oversight Committee on the revisions to its funding formula for community colleges pursuant to subsection (b) of this section, including the structure of the revised formula, the process for implementing the revised formula, and any recommended changes to the revised formula.



 



NCCCS IDD Workforce Training Expansion



SECTION 6.4.(a)  G.S. 115D‑10.21(a), as enacted by this act, reads as rewritten:



(a)      The State Board of Community Colleges shall establish a community college training program for up to 15 25 community colleges. The program shall provide opportunities for micro‑credentials or other credentials that lead to increased employment outcomes for individuals with intellectual and developmental disabilities (IDD). To the extent funds are appropriated for this purpose, the program shall improve the ability of participating community colleges to offer training and educational components that include improving employability skills and providing on‑the‑job training and apprenticeships with business and industry for individuals with IDD. The goal of the program shall be to inform community colleges and address cross‑departmental supports within the individual community colleges on programs for individuals with IDD related to at least the following:



(1)        Establishing best practices for providing vocational training for individuals with IDD.



(2)        Providing financial and benefits counseling.



(3)        Developing strategies on integrating assistive technology.



(4)        Maximizing access, with supports, to credential and degree programs, including micro‑credentials that are established by the State Board.



(5)        Identifying methods to increase orientation and integration of individuals with IDD into the college community to the greatest extent possible.



(6)        Determining a needs assessment, marketing, and evaluation to serve a broad array of individuals with developmental and other similar disabilities or learning challenges to assure adequate demand for new or existing programs.



SECTION 6.4.(b)  Of the funds appropriated for North Carolina Community Colleges System IDD Workforce Training Expansion in this act, the Community Colleges System Office shall use the funds as follows:



(1)        The sum of six hundred forty thousand dollars ($640,000) in recurring funds shall be used to create two positions to facilitate the creation of work‑based learning opportunities and be dedicated to engagement with business and industry partners statewide. These funds shall also be used for the expansion of Career and College Promise high school pathways and pre‑apprenticeships and work‑based learning for individuals with intellectual and developmental disabilities.



(2)        The sum of eight hundred ten thousand dollars ($810,000) may be used for marketing evaluation, online resources, professional development, and infrastructure support.



(3)        The remaining funds shall be used to expand the program developed pursuant to G.S. 115D‑10.21, as amended by this section.



SECTION 6.4.(c)  The Community Colleges System Office shall continue to provide funds to community colleges participating in the program developed pursuant to G.S. 115D‑10.21, as amended by this section, at the rate of one hundred ninety‑four thousand dollars ($194,000) per participating community college.



 



Chapter 115D Reorganization



SECTION 6.5.(a)  Article 1 of Chapter 115D of the General Statutes reads as rewritten:



Article 1.



General Provisions for State Administration.



Part 1. Establishment and Administration of the North Carolina Community Colleges System.



§ 115D‑1.  Statement of purpose.



The purposes of this Chapter are to provide for the establishment, organization, and administration of a system of educational institutions throughout the State offering courses of instruction in one or more of the general areas of two‑year college parallel, technical, vocational, and adult education programs, to serve as a legislative charter for such institutions, and to authorize the levying of local taxes and the issuing of local bonds for the support thereof. The major purpose of each and every institution operating under the provisions of this Chapter shall be and shall continue to be the offering of vocational and technical education and training, and of basic, high school level, academic education needed in order to profit from vocational and technical education, for students who are high school graduates or who are beyond the compulsory age limit of the public school system and who have left the public schools, provided, juveniles of any age committed to the Division of Juvenile Justice of the Department of Public Safety by a court of competent jurisdiction may, if approved by the director of the youth development center to which they are assigned, take courses offered by institutions of the system if they are otherwise qualified for admission.



The Community Colleges System Office is designated as the primary lead agency for delivering workforce development training, adult literacy training, and adult education programs in the State.



…



§ 115D‑1.3.  Accreditation of secondary school located in North Carolina shall not be a factor in admissions, loans, scholarships, or other educational policies.



(a)        For purposes of this section, the term accreditation shall include certification or any other similar approval process.



(b)        The State Board of Community Colleges shall adopt a policy that prohibits any community college from soliciting or using information regarding the accreditation of a secondary school located in North Carolina that a person attended as a factor affecting admissions, loans, scholarships, or other educational activity at the community college, unless the accreditation was conducted by a State agency.



…



§ 115D‑4.1.  College transfer program approval; standards for programs; annual reporting requirements.



(a)        Repealed by Session Laws 1995, c. 288, s. 1, effective September 1, 1995.



(b)        The State Board of Community Colleges may approve the addition of the college transfer program to a community college. If addition of the college transfer program to an institution would require a substantial increase in funds, State Board approval shall be subject to appropriation of funds by the General Assembly for this purpose.



(c)        Addition of the college transfer program shall not decrease an institution's ability to provide programs within its basic mission of vocational and technical training and basic academic education.



(d)       The State Board of Community Colleges shall develop appropriate criteria and standards to regulate the addition of the college transfer program to institutions.



(e)        The State Board of Community Colleges shall develop appropriate criteria and standards to regulate the operation of college transfer programs.



(f)        The Board of Governors of The University of North Carolina shall report to each community college and to the State Board of Community Colleges in accordance with G.S. 116‑11(10b) on the academic performance of that community college's transfer students. If the State Board of Community Colleges finds that college transfer students from a community college are not consistently performing adequately at a four‑year college, the Board shall review the community college's program and determine what steps are necessary to remedy the problem. The Board shall report annually to the General Assembly on the reports it receives and on what steps it is taking to remedy problems that it finds.



(g)        The Community Colleges System Office shall report by April 15, 2011, and annually thereafter, to the Joint Legislative Education Oversight Committee, the State Board of Education, the Office of State Budget and Management, and the Fiscal Research Division of the General Assembly on the implementation of the UNC‑NCCCS 2+2 E‑Learning Initiative. This report shall include:



(1)        The courses and programs within the 2+2 E‑Learning Initiative;



(2)        The total number of prospective teachers that have taken or are taking part in this initiative to date broken down by the current academic period and each of the previous academic periods since the program’s inception;



(3)        The total number of teachers currently in the State’s classrooms, by local school administrative unit, who have taken part in this initiative;



(4)        The change in the number of teachers available to schools since the program’s inception;



(5)        The qualitative data from students, teachers, local school administrative unit personnel, university personnel, and community college personnel as to the impact of this initiative on our State’s teaching pool; and



(6)        An explanation of the expenditures and collaborative programs between the North Carolina Community College System and The University of North Carolina, including recommendations for improvement.



§ 115D‑5.  Administration of institutions by State Board of Community Colleges; personnel exempt from North Carolina Human Resources Act; extension courses; tuition waiver; in‑plant training; contracting, etc., for establishment and operation of extension units of the community college system; use of existing public school facilities.



(a)        The State Board of Community Colleges may adopt and execute such policies, regulations and standards concerning the establishment, administration, and operation of institutions as the State Board may deem necessary to insure the quality of educational programs, to promote the systematic meeting of educational needs of the State, and to provide for the equitable distribution of State and federal funds to the several institutions.



The State Board of Community Colleges shall establish standards and scales for salaries and allotments paid from funds administered by the State Board, and all employees of the institutions shall be exempt from the provisions of the North Carolina Human Resources Act. Any and all salary caps set by the State Board for community college presidents shall apply only to the State‑paid portion of the salary. Except as otherwise provided by law, the employer contribution rate on the local‑paid portion of the salary, to be paid from local funds, shall be set by the State Treasurer based on actuarial recommendations. The State Board shall have authority with respect to individual institutions: to approve sites, capital improvement projects, budgets; to approve the selection of the chief administrative officer; to establish and administer standards for professional personnel, curricula, admissions, and graduation; to regulate the awarding of degrees, diplomas, and certificates; to establish and regulate student tuition and fees within policies for tuition and fees established by the General Assembly; and to establish and regulate financial accounting procedures.



The State Board of Community Colleges shall require each community college to meet the faculty credential requirements of its accrediting agency for all community college programs.



(a1)      Notwithstanding G.S. 66‑58(c)(3) or any other provisions of law, the State Board of Community Colleges may adopt rules governing the expenditure of funds derived from bookstore sales by community colleges. These expenditures shall be consistent with the mission and purpose of the Community College System. Profits may be used in the support and enhancement of the bookstores, for student aid or scholarships, for expenditures of direct benefit to students, and for other similar expenditures authorized by the board of trustees, subject to rules adopted by the State Board. These funds shall not be used to supplement salaries of any personnel.



(a2)      The State Board of Community Colleges shall comply with the provisions of G.S. 116‑11(10a) to plan and implement an exchange of information between the public schools and the institutions of higher education in the State.



(a3)      The State Board of Community Colleges shall adopt the following rules to assist community colleges in their administration of procedures necessary to implement G.S. 20‑11 and G.S. 20‑13.2:



(1)        To establish the procedures a person who is or was enrolled in a community college must follow and the requirements that person must meet to obtain a driving eligibility certificate.



(2)        To require the person who is required under G.S. 20‑11(n) to sign the driving eligibility certificate to provide the certificate if he or she determines that one of the following requirements is met:



a.         The person seeking the certificate is eligible for the certificate under G.S. 20‑11(n)(1) and is not subject to G.S. 20‑11(n1).



b.         The person seeking the certificate is eligible for the certificate under G.S. 20‑11(n)(1) and G.S. 20‑11(n1).



(3)        To provide for an appeal through the grievance procedures established by the board of trustees of each community college by a person who is denied a driving eligibility certificate.



(4)        To define exemplary student behavior and to define what constitutes the successful completion of a drug or alcohol treatment counseling program.



The State Board also shall develop policies as to when it is appropriate to notify the Division of Motor Vehicles that a person who is or was enrolled in a community college no longer meets the requirements for a driving eligibility certificate. The State Board also shall adopt guidelines to assist the presidents of community colleges in their designation of representatives to sign driving eligibility certificates.



The State Board shall develop a form for the appropriate individuals to provide their written, irrevocable consent for a community college to disclose to the Division of Motor Vehicles that the student no longer meets the conditions for a driving eligibility certificate under G.S. 20‑11(n)(1) or G.S. 20‑11(n1), if applicable, in the event that this disclosure is necessary to comply with G.S. 20‑11 or G.S. 20‑13.2. Other than identifying under which statutory subsection the student is no longer eligible, no other details or information concerning the student's school record shall be released pursuant to this consent.



(b)        In order to make instruction as accessible as possible to all citizens, the teaching of curricular courses and of noncurricular extension courses at convenient locations away from institution campuses as well as on campuses is authorized and shall be encouraged. A pro rata portion of the established regular tuition rate charged a full‑time student shall be charged a part‑time student taking any curriculum course. In lieu of any tuition charge, the State Board of Community Colleges shall establish a uniform registration fee, or a schedule of uniform registration fees, to be charged students enrolling in extension courses for which instruction is financed primarily from State funds. The State Board of Community Colleges may provide by general and uniform regulations for waiver of tuition and registration fees for the following:



(1)        Persons not enrolled in elementary or secondary schools taking courses leading to a high school diploma or equivalent certificate.



(2)        Courses requested by the following entities that support the organizations' training needs and are on a specialized course list approved by the State Board of Community Colleges:



a.         Volunteer fire departments.



b.         Municipal, county, or State fire departments.



c.         Volunteer EMS or rescue and lifesaving departments.



d.         Municipal, county, or State EMS or rescue and lifesaving departments.



d1.       Law enforcement, fire, EMS or rescue and lifesaving entities serving a lake authority that was created by a county board of commissioners prior to July 1, 2012.



e.         Radio Emergency Associated Communications Teams (REACT) under contract to a county as an emergency response agency.



f.          Municipal, county, or State law enforcement agencies.



f1.        Campus police agencies of private institutions of higher education certified by the Attorney General pursuant to Chapter 74G of the General Statutes.



g.         The Division of Prisons of the Department of Adult Correction and the Division of Juvenile Justice of the Department of Public Safety for the training of full‑time custodial employees and employees of the Divisions required to be certified under Article 1 of Chapter 17C of the General Statutes and the rules of the Criminal Justice and Training Standards Commission.



h.         Repealed by Session Laws 2017‑186, s. 2(hhhhh), effective December 1, 2017.



i.          The Eastern Band of Cherokee Indians law enforcement, fire, EMS or rescue and lifesaving tribal government departments or programs.



j.          The Criminal Justice Standards Division of the Department of Justice for the training of criminal justice professionals, as defined in G.S. 17C‑20(6), who are required to be certified under (i) Article 1 of Chapter 17C of the General Statutes and the rules of the North Carolina Criminal Justice Education and Training Standards Commission or (ii) Chapter 17E of the General Statutes and the rules of the North Carolina Sheriffs' Education and Training Standards Commission. The waivers provided for in this sub‑subdivision apply to participants and recent graduates of the North Carolina Criminal Justice Fellows Program to obtain certifications for eligible criminal justice professions as defined in G.S. 17C‑20(6).



(2a)      Firefighters, EMS personnel, and rescue and lifesaving personnel whose duty station is located on a military installation within North Carolina for courses that support their organizations' training needs and are approved for this purpose by the State Board of Community Colleges.



(3)        Repealed by Session Laws 2011‑145, s. 8.12(a), effective July 1, 2011.



(4)        Trainees enrolled in courses conducted under the Customized Training Program.



(5)        through (9) Repealed by Session Laws 2011‑145, s. 8.12(a), effective July 1, 2011.



(10)      Elementary and secondary school employees enrolled in courses in first aid or cardiopulmonary resuscitation (CPR).



(11)      Repealed by Session Laws 2013‑360, s. 10.6, effective July 1, 2013.



(12)      All courses taken by high school students at community colleges, in accordance with G.S. 115D‑20(4) and this section.



(13)      Human resources development courses for any individual who (i) is unemployed; (ii) has received notification of a pending layoff; (iii) is working and is eligible for the Federal Earned Income Tax Credit (FEITC); or (iv) is working and earning wages at or below two hundred percent (200%) of the federal poverty guidelines.



(14)      Repealed by Session Laws 2011‑145, s. 8.12(a), effective July 1, 2011.



(15)      Courses providing employability skills, job‑specific occupational or technical skills, or developmental education instruction to certain students who are concurrently enrolled in an eligible community college literacy course, in accordance with rules adopted by the State Board of Community Colleges.



(16)      Courses provided to students who are participating in a pre‑apprenticeship or apprenticeship program that meets all of the following criteria:



a.         Meets one of the following:



1.         Is a registered apprenticeship program recognized by the United States Department of Labor.



2.         Is a pre‑apprenticeship program recognized and approved by the State agency administering the statewide apprenticeship program.



b.         Has a documented plan of study with courses relating to a job‑specific occupational or technical skill.



c.         Requires the participants in the program to be North Carolina high school students when entering the program.



The State Board of Community Colleges shall not waive tuition and registration fees for other individuals.



(b1)      The State Board of Community Colleges shall not waive tuition and registration fees for community college faculty or staff members. Community colleges may, however, use State or local funds to pay tuition and registration fees for one course per semester for full‑time community college faculty or staff members employed for a nine‑, ten‑, eleven‑, or twelve‑month term. Community colleges may also use State and local funds to pay tuition and registration fees for professional development courses and for other courses consistent with the academic assistance program authorized by the State Human Resources Commission.



(b2)      Beginning February 1, 2018, and annually thereafter, the Community Colleges System Office shall report to the Joint Legislative Education Oversight Committee on the number and type of waivers granted pursuant to subsection (b) of this section.



(c)        No course of instruction shall be offered by any community college at State expense or partial State expense to any captive or co‑opted group of students, as defined by the State Board of Community Colleges, without prior approval of the State Board of Community Colleges. All course offerings approved for State prison inmates or prisoners in local jails must be tied to clearly identified job skills, transition needs, or both. Approval by the State Board of Community Colleges shall be presumed to constitute approval of both the course and the group served by that institution. The State Board of Community Colleges may delegate to the President the power to make an initial approval, with final approval to be made by the State Board of Community Colleges. A course taught without such approval will not yield any full‑time equivalent students, as defined by the State Board of Community Colleges.



(c1)      Community colleges shall report full‑time equivalent (FTE) student hours for correction education programs on the basis of student membership hours. No community college shall operate a multi‑entry/multi‑exit class or program in a prison facility, except for a literacy class or program.



The State Board shall work with the Division of Adult Correction and Juvenile Justice of the Department of Public Safety on offering classes and programs that match the average length of stay of an inmate in a prison facility.



(c2)      Courses in federal prisons shall not earn regular budget full‑time equivalents, but may be offered on a self‑supporting basis.



(c3)      Funds appropriated for community college courses for prison inmates shall be used only for inmates in State prisons. The first priority for the use of these funds shall be to restore the FTE for basic skills courses to the FY 2008‑2009 level. Funds not needed for this purpose may be used for continuing education and curriculum courses related to job skills training.



(d)       Recodified as G.S. 115D‑5.1(a) by Session Laws 2005‑276, s. 8.4(a), effective July 1, 2005.



(e)        Repealed by Session Laws 1999‑84, s. 3, effective May 21, 1999.



(f)        A community college may not offer a new program without the approval of the State Board of Community Colleges except that approval shall not be required if the tuition for the program will fully cover the cost of the program. If at any time tuition fails to fully cover the cost of a program that falls under the exception, the program shall be discontinued unless approved by the State Board of Community Colleges. If a proposed new program would serve more than one community college, the State Board of Community Colleges shall perform a feasibility study prior to acting on the proposal. The State Board of Community Colleges shall consider whether a regional approach can be used when developing new programs and, to the extent possible, shall initiate new programs on a regional basis.



The State Board of Community Colleges shall collect data on an annual basis on all new programs and program terminations it approved and any regionalization of programs during the year, including the specific reasons for which each program was terminated or approved.



(f1)      The State Board shall adopt a policy requiring community colleges to be accredited in accordance with G.S. 115D-6.2.



(g)        Funds appropriated to the Community Colleges System Office as operating expenses for allocation to the institutions comprising the North Carolina Community College System shall not be used to support recreation extension courses. The financing of these courses by any institution shall be on a self‑supporting basis, and membership hours produced from these activities shall not be counted when computing full‑time equivalent students (FTE) for use in budget‑funding formulas at the State level.



(h)        Whenever a community college offers real estate continuing education courses pursuant to G.S. 93A‑4.1, the courses shall be offered on a self‑supporting basis.



(i)         Recodified as G.S. 115D‑5.1(c) by Session Laws 2005‑276, s. 8.4(a), effective July 1, 2005.



(j)         The State Board of Community Colleges shall use its Board Reserve Fund for feasibility studies, pilot projects, start‑up of new programs, and innovative ideas.



(k)        Recodified as G.S. 115D‑5.1(b) by Session Laws 2005‑276, s. 8.4(a), effective July 1, 2005.



(l)         The State Board shall review and approve lease purchase and installment purchase contracts as provided under G.S. 115D‑58.15(b). The State Board shall adopt policies and procedures governing the review and approval process.



(m)       The State Board of Community Colleges shall maintain an accountability function that conducts periodic reviews of each community college operating under the provisions of this Chapter. The purpose of the compliance review shall be to ensure that (i) data used to allocate State funds among community colleges is reported accurately to the System Office and (ii) community colleges are charging and waiving tuition and registration fees consistent with law. The State Board of Community Colleges shall require the use of a statistically valid sample size in performing compliance reviews of community colleges. All compliance review findings that are determined to be material shall be forwarded to the college president, local college board of trustees, the State Board of Community Colleges, and the State Auditor. The State Board of Community Colleges shall adopt rules governing the frequency, scope, and standard of materiality for compliance reviews.



(n)        The North Carolina Community Colleges System Office shall provide the Department of Revenue with a list of all community colleges, including name, address, and other identifying information requested by the Department of Revenue. The North Carolina Community Colleges System Office shall update this list whenever there is a change.



(o)        All multicampus centers approved by the State Board of Community Colleges shall receive funding under the same formula. The State Board of Community Colleges shall not approve any additional multicampus centers without identified recurring sources of funding. A community college facility shall be considered a multicampus center if it meets all of the following criteria:



(1)        Is at least 4 miles away from the main campus of the community college and other multicampus center locations.



(2)        Any other criteria established by the State Board.



(p)        The North Carolina Community College System may offer courses, in accordance with Article 17D of Subchapter V of Chapter 115C of the General Statutes, to individuals who choose to enter the teaching profession through residency licensure.



(q)        Repealed by Session Laws 2009‑451, s. 8.9, effective July 1, 2009.



(r)        The State Board of Community Colleges shall develop curriculum and continuing education standards for courses of instruction in American Sign Language and shall encourage community colleges to offer courses in American Sign Language as a modern foreign language.



(s)        The State Board of Community Colleges may establish, retain and budget fees charged to students taking an adult high school equivalency diploma test, including fees for retesting. Fees collected for this purpose shall be used only to (i) offset the costs of the test, including the cost of scoring the test, (ii) offset the costs of printing adult high school equivalency diplomas, and (iii) meet federal and State reporting requirements related to the test.



(t)        The purpose of the first semester of the Gateway to College Program is to address additional support to successfully complete the program. Students may need to take developmental courses necessary for the transition to more challenging courses; therefore, the State Board of Community Colleges shall (i) permit high school students who are enrolled in Gateway to College Programs to enroll in developmental courses based on an assessment of their individual student needs by a high school and community college staff team and (ii) include this coursework in computing the budget FTE for the colleges.



(u)        The State Board of Community Colleges shall direct each community college to adopt a policy that authorizes a minimum of two excused absences each academic year for religious observances required by the faith of a student. The policy may require that the student provide written notice of the request for an excused absence a reasonable time prior to the religious observance. The policy shall also provide that the student shall be given the opportunity to make up any tests or other work missed due to an excused absence for a religious observance.



(v)        Community colleges may teach curriculum courses at any time during the year, including the summer term. Student membership hours from these courses shall be counted when computing full‑time equivalent students (FTE) for use in budget funding formulas at the State level.



(w)       The State Board of Community Colleges shall review, at least every five years, service areas that include counties assigned to more than one community college to determine the feasibility of continuing to assign those counties to more than one community college. The State Board shall revise service areas as needed to ensure that counties are served effectively. The first review and any revisions shall be completed no later than March 1, 2016, and the State Board shall report its findings and any revisions to the Joint Legislative Education Oversight Committee no later than March 1, 2016. All subsequent reviews and revisions shall also be submitted to the Committee.



(x)        In addition to the evaluation of cooperative innovative high schools by the State Board of Education pursuant to G.S. 115C‑238.55, the State Board of Community Colleges, in conjunction with the State Board of Education and the Board of Governors of The University of North Carolina, shall evaluate the success of students participating in the Career and College Promise Program, including the College Transfer pathway and the Career and Technical Education pathway. Success shall be measured by high school retention rates, high school completion rates, high school dropout rates, certification and associate degree completion, admission to four‑year institutions, postgraduation employment in career or study‑related fields, and employer satisfaction of employees who participated in the programs. The evaluation shall also include an analysis of the cost of students participating in each of the programs within the Career and College Promise Program, including at least the following:



(1)        Total enrollment funding, the number of budgeted full‑time equivalent students, and the number of students enrolled in courses through cooperative innovative high schools, the College Transfer pathway, and the Career and Technical Education pathway.



(2)        The cost and number of waivers of tuition and registration fees provided for students enrolled in courses through cooperative innovative high schools, the College Transfer pathway, and the Career and Technical Education pathway.



(3)        Any additional costs of a student attending courses on campus if a student is not attending public school in a local school administrative unit for the majority of the student's instructional time.



The Boards shall jointly report by March 15 of each year to the Joint Legislative Education Oversight Committee, the Senate Appropriations Committee on Education/Higher Education, the House Appropriations Committee on Education, and the Fiscal Research Division of the General Assembly. The report shall be combined with the evaluation of cooperative innovative high schools required by G.S. 115C‑238.55, and the Community Colleges System Office shall be responsible for submitting the combined report.



(y)        The State Board of Community Colleges shall adopt a policy to be applied uniformly throughout the Community College System to provide that any student enrolled in a community college who is a National Guard service member placed onto State active duty status during an academic term shall be given an excused absence for the period of time the student is on active duty. The policy shall further provide all of the following:



(1)        The student shall be given the opportunity to make up any test or other work missed during the excused absence.



(2)        The student shall be given the option, when feasible, to continue classes and coursework during the academic term through online participation for the period of time the student is placed on active duty.



(3)        The student shall be given the option of receiving a temporary grade of incomplete (IN) or absent from the final exam (AB) for any course that the student was unable to complete as a result of being placed on State active duty status; however, the student must complete the course requirements within the period of time specified by the community college to avoid receiving a failing grade for the course.



(4)        The student shall be permitted to drop, with no penalty, any course that the student was unable to complete as a result of being placed on State active duty status.



(z)        The State Board of Community Colleges shall monitor community colleges for compliance with Article 38 of Chapter 116 of the General Statutes. If the State Board determines that a community college is in violation of Article 38, it shall report the identity of the community college to the Joint Legislative Education Oversight Committee.



§ 115D‑5.1.  Workforce Development Programs.



(a)        Community colleges shall assist in the preemployment and in‑service training of employees in industry, business, agriculture, health occupation and governmental agencies. Such training shall include instruction on worker safety and health standards and practices applicable to the field of employment. The State Board of Community Colleges shall make appropriate regulations including the establishment of maximum hours of instruction which may be offered at State expense in each in‑plant training program. No instructor or other employee of a community college shall engage in the normal management, supervisory and operational functions of the establishment in which the instruction is offered during the hours in which the instructor or other employee is employed for instructional or educational purposes.



(b)        through (d)  Repealed by Session Laws 2008‑107, s. 8.7(a), effective July 1, 2008.



(e)        There is created within the North Carolina Community College System the Customized Training Program. The Customized Training Program shall offer programs and training services to assist new and existing business and industry to remain productive, profitable, and within the State. Before a business or industry qualifies to receive assistance under the Customized Training Program, the President of the North Carolina Community College System shall determine that:



(1)        The business is making an appreciable capital investment;



(2)        The business is deploying new technology;



(2a)      The business or individual is creating jobs, expanding an existing workforce, or enhancing the productivity and profitability of the operations within the State; and



(3)        The skills of the workers will be enhanced by the assistance.



(f)        The Community Colleges System Office shall report no later than September 1 of each year to the Joint Legislative Education Oversight Committee on:



(1)        The total amount of funds received by a company under the Customized Training Program.



(1a)      The types of services sought by the company, whether for new, expanding, or existing industry.



(2)        The amount of funds per trainee received by that company.



(3)        The amount of funds received per trainee by the community college delivering the training.



(4)        The number of trainees trained by the company and community college.



(5)        The number of years that company has been funded.



(f1)      Notwithstanding any other provision of law, the State Board of Community Colleges may adopt guidelines that allow the Customized Training Program to use funds appropriated for that program to support training projects for the various branches of the Armed Forces of the United States.



(f2)      Funds available to the Customized Training Program shall not revert at the end of a fiscal year but shall remain available until expended. Up to ten percent (10%) of the college‑delivered training expenditures and up to five percent (5%) of the contractor‑delivered training expenditures for the prior fiscal year for Customized Training may be allotted to each college for capacity building at that college.



(f3)      Of the funds appropriated in a fiscal year for the Customized Training Programs, the State Board of Community Colleges may approve the use of up to eight percent (8%) for the training and support of regional community college personnel to deliver Customized Training Program services to business and industry.



(g)        The State Board shall adopt guidelines to implement this section. At least 20 days before the effective date of any criteria or nontechnical amendments to guidelines, the State Board must publish the proposed guidelines on the Community Colleges System Office's web site and provide notice to persons who have requested notice of proposed guidelines. In addition, the State Board must accept oral and written comments on the proposed guidelines during the 15 business days beginning on the first day that the State Board has completed these notifications. For the purpose of this subsection, a technical amendment is either of the following:



(1)        An amendment that corrects a spelling or grammatical error.



(2)        An amendment that makes a clarification based on public comment and could have been anticipated by the public notice that immediately preceded the public comment.



§ 115D‑5.1A.  Short‑Term Workforce Development Grant Program.



(a)        Program Established. – There is established the North Carolina Community College Short‑Term Workforce Development Grant Program (Program) to be administered by the State Board of Community Colleges. The State Board shall adopt rules for the disbursement of the grants pursuant to this section.



(b)        Programs of Study. – The State Board of Community Colleges, in collaboration with the Department of Commerce, shall determine the eligible programs of study for the Program, according to the occupations that are in the highest demand in the State. The eligible programs of study shall include programs such as architecture and construction, health sciences, information technology, electrical line worker, and manufacturing programs and may include other programs to meet local workforce needs.



(c)        Award Amounts. – To the extent funds are made available for the Program, the State Board of Community Colleges shall award grants in an amount of up to seven hundred fifty dollars ($750.00) to students pursuing short‑term, noncredit State and industry workforce credentials. The State Board of Community Colleges shall establish criteria for initial and continuing eligibility for students. At a minimum, students shall be required to qualify as a resident for tuition purposes under the criteria set forth in G.S. 116‑143.1 and in accordance with the coordinated and centralized residency determination process administered by the State Education Assistance Authority.



(d)       Report. – The State Board shall submit a report by April 1, 2024, and annually thereafter, on the Program to the Joint Legislative Education Oversight Committee and the Fiscal Research Division. The report shall contain, for each academic year and by programs of study, the amount of grant funds disbursed and the number of eligible students receiving funds.



§ 115D‑5.2.  Commercial fishing and aquaculture classes.



(a)        The General Assembly urges all community colleges serving the coastal area of the State to offer classes on commercial fishing and aquaculture.



(b)        The North Carolina Community Colleges System Office shall provide technical assistance to these colleges on offering such classes.



(c)        The North Carolina Community Colleges System Office shall report to the Joint Legislative Education Oversight Committee on any fiscal and administrative issues it identifies that limit colleges' ability to offer such courses.



§ 115D‑5.5.  Board Reserve Fund.



The State Board of Community Colleges shall use its Board Reserve Fund for feasibility studies, pilot projects, start‑up of new programs, and innovative ideas.



Part 2. Administration of Local Community Colleges by State Board of Community Colleges.



§ 115D‑6.  Withdrawal of State support.



The State Board of Community Colleges may withdraw or withhold State financial and administrative support of any institutions subject to the provisions of this Chapter in the event that:of any of the following:



(1)        The required local financial support of an institution is not provided;provided.



(2)        Sufficient State funds are not available;available.



(3)        The officials of an institution refuse or are unable to maintain prescribed standards of administration or instruction; orinstruction.



(4)        Local educational needs for such an institution cease to exist.



§ 115D‑6.1.  Administration of institutions.



(a)        Policies. – The State Board of Community Colleges may adopt and execute such policies, regulations, and standards concerning the establishment, administration, and operation of institutions as the State Board may deem necessary to ensure the quality of educational programs, to promote the systematic meeting of educational needs of the State, and to provide for the equitable distribution of State and federal funds to the several institutions.



(b)        Authority. – The State Board shall have the following authority with respect to individual institutions:



(1)        To approve sites, capital improvement projects, and budgets.



(2)        To approve the selection of the chief administrative officer.



(3)        To establish and administer standards for professional personnel, curricula, admissions, and graduation.



(4)        To regulate the awarding of degrees, diplomas, and certificates.



(5)        To establish and regulate student tuition and fees within policies for tuition and fees established by the General Assembly.



(6)        To establish and regulate financial accounting procedures.



(c)        Salaries. – The State Board shall establish standards and scales for salaries and allotments paid from funds administered by the State Board, and all employees of the institutions shall be exempt from the provisions of the North Carolina Human Resources Act. Any and all salary caps set by the State Board for community college presidents shall apply only to the State‑paid portion of the salary. Except as otherwise provided by law, the employer contribution rate on the local‑paid portion of the salary, to be paid from local funds, shall be set by the State Treasurer based on actuarial recommendations.



(d)       Faculty Credentials. – The State Board of Community Colleges shall require each community college to meet the faculty credential requirements of its accrediting agency for all community college programs.



§ 115D‑6.2.  Accreditation.Accreditation policy.



The State Board of Community Colleges shall adopt a policy requiring community colleges to be accredited in accordance with G.S. 115D‑21.2.



(a)        Definitions. – The following definitions apply in this section:



(1)        Accreditation cycle. – The period of time during which a community college is accredited.



(2)        Accrediting agency. – An agency or association that accredits institutions of higher education.



(3)        Regional accrediting agency. – One of the following accrediting agencies:



a.         Higher Learning Commission.



b.         Middle States Commission on Higher Education.



c.         New England Commission on Higher Education.



d.         Northwest Commission on Colleges and Universities.



e.         Southern Association of Colleges and Schools Commission on Colleges.



f.          Western Association of Schools and Colleges Accrediting Commission for Community and Junior Colleges.



(b)        Prohibit Consecutive Accreditation by an Accrediting Agency. – A community college shall not receive accreditation by an accrediting agency for consecutive accreditation cycles except as provided in subsection (c) of this section.



(c)        Accreditation Transfer Procedure. – A community college that pursues accreditation with a different accrediting agency in accordance with this section shall pursue accreditation with a regional accrediting agency. If the community college is not granted candidacy status by any regional accrediting agency that is different from its current accrediting agency at least three years prior to the expiration of its current accreditation, the community college may remain with its current accrediting agency for an additional accreditation cycle.



(d)       Certain Programs Exempt. – The requirements of this section do not apply to professional, departmental, or certificate programs at community colleges that have specific accreditation requirements or best practices, as identified by the State Board of Community Colleges.



(e)        Cause of Action. – A community college may bring a civil action, as follows:



(1)        Against any person who makes a false statement to the accrediting agency of the community college, if all of the following criteria are met:



a.         The statement, if true, would mean the community college is out of compliance with its accreditation standards.



b.         The person made the statement with knowledge that the statement was false or with reckless disregard as to whether it was false.



c.         The accrediting agency conducted a review of the community college as a proximate result of the statement.



d.         The review caused the community college to incur costs.



(2)        A community college that prevails on a cause of action initiated pursuant to this subsection shall be entitled to the following:



a.         Costs related to the review conducted by the accrediting agency, including for the following:



1.         Additional hours worked by community college personnel.



2.         Contracted services, including outside legal counsel.



3.         Travel, lodging, and food expenses.



4.         Fees required by the agency.



b.         Reasonable attorney fees.



c.         Court costs.



§ 115D‑6.5.  Notice of noncompliance; appointment of an interim board of trustees.



…



(c)        Interim Board Assumption of Powers and Duties. – The adoption of the resolution to remove the full board under this section shall have the effect of vacating the terms of all of the members serving on the board of trustees. Notwithstanding G.S. 115D‑12, the State Board of Community Colleges shall appoint an interim five‑member board of trustees for a period not to exceed 12 months with input from the advisory committee listed in subsection (a) of this section. To preserve local autonomy, the appointing authorities of the local administrative area of the community college under G.S. 115D‑12 shall make recommendations to the State Board on the appointment of the members to the interim board of trustees. All appointees to the interim board of trustees shall be residents of the administrative area of the institution for which they are selected or of counties contiguous thereto with the exception of members provided for in subsection (a) of G.S. 115D‑12, Group Four. G.S. 115D‑12(a)(3). At the end of the period of service of the interim board of trustees, a board of trustees for the community college shall be appointed in accordance with G.S. 115D‑12. Initial terms of members of the new board of trustees shall be staggered to align with the remainder of the vacated terms of the members of the board of trustees.



…



§ 115D‑9.5.  Bookstore sales.



Notwithstanding G.S. 66‑58(c)(3) or any other provisions of law, the State Board of Community Colleges may adopt rules governing the expenditure of funds derived from bookstore sales by community colleges. These expenditures shall be consistent with the mission and purpose of the Community College System. Profits may be used in the support and enhancement of the bookstores, for student aid or scholarships, for expenditures of direct benefit to students, and for other similar expenditures authorized by the board of trustees, subject to rules adopted by the State Board. These funds shall not be used to supplement salaries of any personnel.



§ 115D‑9.10.  Exchange of information with The University of North Carolina and North Carolina public schools.



The State Board of Community Colleges shall comply with the provisions of G.S. 116‑11(10a) to plan and implement an exchange of information between the public schools and the institutions of higher education in the State.



§ 115D‑9.15.  Lease purchase and installment purchase contracts.



The State Board of Community Colleges shall review and approve lease purchase and installment purchase contracts as provided under G.S. 115D‑58.15(b). The State Board shall adopt policies and procedures governing the review and approval process.



§ 115D‑9.20.  Compliance review and requested information.



(a)        Compliance Review. – The State Board of Community Colleges shall maintain an accountability function that conducts periodic reviews of each community college operating under the provisions of this Chapter. The purpose of the compliance review shall be to ensure that (i) data used to allocate State funds among community colleges is reported accurately to the System Office and (ii) community colleges are charging and waiving tuition and registration fees consistent with law. The State Board of Community Colleges shall require the use of a statistically valid sample size in performing compliance reviews of community colleges. All compliance review findings that are determined to be material shall be forwarded to the college president, local college board of trustees, the State Board of Community Colleges, and the State Auditor. The State Board of Community Colleges shall adopt rules governing the frequency, scope, and standard of materiality for compliance reviews.



(b)        Information to Department of Revenue. – The North Carolina Community Colleges System Office shall provide the Department of Revenue with a list of all community colleges, including name, address, and other identifying information requested by the Department of Revenue. The North Carolina Community Colleges System Office shall update this list whenever there is a change.



§ 115D‑9.25.  Multicampus centers.



All multicampus centers approved by the State Board of Community Colleges shall receive funding under the same formula. The State Board of Community Colleges shall not approve any additional multicampus centers without identified recurring sources of funding. A community college facility shall be considered a multicampus center if it meets the criteria established by the State Board and is at least 4 miles away from the main campus of the community college and other multicampus center locations.



§ 115D‑9.30.  Service areas.



The State Board of Community Colleges shall review, at least every five years, service areas that include counties assigned to more than one community college to determine the feasibility of continuing to assign those counties to more than one community college. The State Board shall revise service areas as needed to ensure that counties are served effectively. The State Board shall report its findings and any revisions to the Joint Legislative Education Oversight Committee within 60 days of revisions being made.



§ 115D‑9.35.  Athletic teams.



The State Board of Community Colleges shall monitor community colleges for compliance with Article 38 of Chapter 116 of the General Statutes. If the State Board determines that a community college is in violation of Article 38 of Chapter 116 of the General Statutes, it shall report the identity of the community college to the Joint Legislative Education Oversight Committee.



…



Part 3. Community College Programs.



§ 115D‑10.5.  Program funding.



(a)        New Programs and Terminations of Programs. – A community college may not offer a new program without the approval of the State Board of Community Colleges except that approval shall not be required if the tuition for the program will fully cover the cost of the program. If at any time tuition fails to fully cover the cost of a program that falls under the exception, the program shall be discontinued unless approved by the State Board. If a proposed new program would serve more than one community college, the State Board shall perform a feasibility study prior to acting on the proposal. The State Board shall consider whether a regional approach can be used when developing new programs and, to the extent possible, shall initiate new programs on a regional basis. The State Board shall collect data on an annual basis on all new programs and program terminations it approved and any regionalization of programs during the year, including the specific reasons for which each program was terminated or approved.



(b)        Recreation Extension Courses. – Funds appropriated to the Community Colleges System Office as operating expenses for allocation to the institutions comprising the North Carolina Community College System shall not be used to support recreation extension courses. The financing of these courses by any institution shall be on a self‑supporting basis, and membership hours produced from these activities shall not be counted when computing full‑time equivalent students (FTE) for use in budget‑funding formulas at the State level.



(c)        Real Estate Continuing Education Courses. – Whenever a community college offers real estate continuing education courses, the courses shall be offered on a self‑supporting basis.



§ 115D‑10.10.  College transfer program approval; standards for programs; annual reporting requirements.



(a)        The State Board of Community Colleges may approve the addition of the college transfer program to a community college. If addition of the college transfer program to an institution would require a substantial increase in funds, State Board approval shall be subject to appropriation of funds by the General Assembly for this purpose.



(b)        Addition of the college transfer program shall not decrease an institution's ability to provide programs within its basic mission of vocational and technical training and basic academic education.



(c)        The State Board of Community Colleges shall develop appropriate criteria and standards to regulate the addition of the college transfer program to institutions.



(d)       The State Board of Community Colleges shall develop appropriate criteria and standards to regulate the operation of college transfer programs.



(e)        The Board of Governors of The University of North Carolina shall report to each community college and to the State Board of Community Colleges in accordance with G.S. 116‑11(10b) on the academic performance of that community college's transfer students. If the State Board of Community Colleges finds that college transfer students from a community college are not consistently performing adequately at a four‑year college, the Board shall review the community college's program and determine what steps are necessary to remedy the problem. The Board shall report annually to the General Assembly on the reports it receives and on what steps it is taking to remedy problems that it finds.



(f)        The Community Colleges System Office shall report annually by April 15 to the Joint Legislative Education Oversight Committee, the State Board of Education, the Office of State Budget and Management, and the Fiscal Research Division of the General Assembly on the implementation of the UNC‑NCCCS 2+2 E‑Learning Initiative. This report shall include the following:



(1)        The courses and programs within the 2+2 E‑Learning Initiative.



(2)        The total number of prospective teachers that have taken or are taking part in this initiative to date broken down by the current academic period and each of the previous academic periods since the program's inception.



(3)        The total number of teachers currently in the State's classrooms, by local school administrative unit, who have taken part in this initiative.



(4)        The change in the number of teachers available to schools since the program's inception.



(5)        The qualitative data from students, teachers, local school administrative unit personnel, university personnel, and community college personnel as to the impact of this initiative on our State's teaching pool.



(6)        An explanation of the expenditures and collaborative programs between the North Carolina Community College System and The University of North Carolina, including recommendations for improvement.



§ 115D‑10.15.  Workforce development programs.



Community colleges shall assist in the preemployment and in‑service training of employees in industry, business, agriculture, health occupation, and governmental agencies. Such training shall include instruction on worker safety and health standards and practices applicable to the field of employment. The State Board of Community Colleges shall make appropriate regulations, including the establishment of maximum hours of instruction which may be offered at State expense in each in‑plant training program. No instructor or other employee of a community college shall engage in the normal management, supervisory, and operational functions of the establishment in which the instruction is offered during the hours in which the instructor or other employee is employed for instructional or educational purposes.



§ 115D‑10.17.  Customized Training Program.



(a)        There is created within the North Carolina Community College System the Customized Training Program. The Customized Training Program shall offer programs and training services to assist new and existing business and industry to remain productive, profitable, and within the State. Before a business or industry qualifies to receive assistance under the Customized Training Program, the President of the North Carolina Community College System shall determine the following:



(1)        The business is making an appreciable capital investment.



(2)        The business is deploying new technology.



(3)        The business or individual is creating jobs, expanding an existing workforce, or enhancing the productivity and profitability of the operations within the State.



(4)        The skills of the workers will be enhanced by the assistance.



(b)        The Community Colleges System Office shall report no later than September 1 of each year to the Joint Legislative Education Oversight Committee on the following:



(1)        The total amount of funds received by a company under the Customized Training Program.



(2)        The types of services sought by the company, whether for new, expanding, or existing industry.



(3)        The amount of funds per trainee received by that company.



(4)        The amount of funds received per trainee by the community college delivering the training.



(5)        The number of trainees trained by the company and community college.



(6)        The number of years that company has been funded.



(c)        Notwithstanding any other provision of law, the State Board of Community Colleges may adopt guidelines that allow the Customized Training Program to use funds appropriated for that program to support training projects for the various branches of the Armed Forces of the United States.



(d)       Funds available to the Customized Training Program shall not revert at the end of a fiscal year but shall remain available until expended. Up to ten percent (10%) of the college‑delivered training expenditures and up to five percent (5%) of the contractor‑delivered training expenditures for the prior fiscal year for Customized Training may be allotted to each college for capacity building at that college.



(e)        Of the funds appropriated in a fiscal year for the Customized Training Program, the State Board of Community Colleges may approve the use of up to eight percent (8%) for the training and support of regional community college personnel to deliver Customized Training Program services to business and industry.



(f)        The State Board shall adopt guidelines to implement this section. At least 20 days before the effective date of any criteria or nontechnical amendments to guidelines, the State Board must publish the proposed guidelines on the Community Colleges System Office's website and provide notice to persons who have requested notice of proposed guidelines. In addition, the State Board must accept oral and written comments on the proposed guidelines during the 15 business days beginning on the first day that the State Board has completed these notifications. For the purpose of this subsection, a technical amendment is either of the following:



(1)        An amendment that corrects a spelling or grammatical error.



(2)        An amendment that makes a clarification based on public comment and could have been anticipated by the public notice that immediately preceded the public comment.



§ 115D‑10.19.  Short‑Term Workforce Development Grant Program.



(a)        Program Established. – There is established the North Carolina Community College Short‑Term Workforce Development Grant Program (Program) to be administered by the State Board of Community Colleges. The State Board shall adopt rules for the disbursement of the grants pursuant to this section.



(b)        Programs of Study. – The State Board of Community Colleges, in collaboration with the Department of Commerce, shall determine the eligible programs of study for the Program, according to the occupations that are in the highest demand in the State. The eligible programs of study shall include programs such as architecture and construction, health sciences, information technology, electrical line worker, and manufacturing programs and may include other programs to meet local workforce needs.



(c)        Award Amounts. – To the extent funds are made available for the Program, the State Board of Community Colleges shall award grants in an amount of up to seven hundred fifty dollars ($750.00) to students pursuing short‑term, noncredit State and industry workforce credentials. The State Board of Community Colleges shall establish criteria for initial and continuing eligibility for students. At a minimum, students shall be required to qualify as a resident for tuition purposes under the criteria set forth in G.S. 116‑143.1 and in accordance with the coordinated and centralized residency determination process administered by the State Education Assistance Authority.



(d)       Report. – The State Board shall submit a report by April 1 annually on the Program to the Joint Legislative Education Oversight Committee and the Fiscal Research Division. The report shall contain, for each academic year and by programs of study, the amount of grant funds disbursed and the number of eligible students receiving funds.



§ 115D‑10.21.  Training programs for students with intellectual and developmental disabilities.



(a)        The State Board of Community Colleges shall establish a community college training program for up to 15 community colleges. The program shall provide opportunities for micro‑credentials or other credentials that lead to increased employment outcomes for individuals with intellectual and developmental disabilities (IDD). To the extent funds are appropriated for this purpose, the program shall improve the ability of participating community colleges to offer training and educational components that include improving employability skills and providing on‑the‑job training and apprenticeships with business and industry for individuals with IDD. The goal of the program shall be to inform community colleges and address cross‑departmental supports within the individual community colleges on programs for individuals with IDD related to at least the following:



(1)        Establishing best practices for providing vocational training for individuals with IDD.



(2)        Providing financial and benefits counseling.



(3)        Developing strategies on integrating assistive technology.



(4)        Maximizing access, with supports, to credential and degree programs, including micro‑credentials that are established by the State Board.



(5)        Identifying methods to increase orientation and integration of individuals with IDD into the college community to the greatest extent possible.



(6)        Determining a needs assessment, marketing, and evaluation to serve a broad array of individuals with developmental and other similar disabilities or learning challenges to assure adequate demand for new or existing programs.



(b)        No later than May 1 of each year, the Community Colleges System Office shall report on the funds appropriated to the System Office for the purposes of this section to the Joint Legislative Education Oversight Committee and the Fiscal Research Division. At a minimum, the report shall address the impact of the program, the use of any additional positions created at community colleges, professional development training for staff, and funding sources identified for individuals with IDD to build programs at community colleges that support postsecondary trainings and certifications that enable individuals with IDD to engage in competitive, sustainable employment.



§ 115D‑10.25.  Commercial fishing and aquaculture classes.



(a)        The General Assembly urges all community colleges serving the coastal area of the State to offer classes on commercial fishing and aquaculture.



(b)        The North Carolina Community Colleges System Office shall provide technical assistance to these colleges on offering such classes.



(c)        The North Carolina Community Colleges System Office shall report to the Joint Legislative Education Oversight Committee on any fiscal and administrative issues it identifies that limit colleges' ability to offer such courses.



§ 115D‑10.30.  Correction education programs.



(a)        Approval. – No course of instruction shall be offered by any community college at State expense or partial State expense to any captive or co‑opted group of students, as defined by the State Board of Community Colleges, without prior approval of the State Board. All course offerings approved for State prison inmates or prisoners in local jails must be tied to clearly identified job skills, transition needs, or both. Approval by the State Board shall be presumed to constitute approval of both the course and the group served by that institution. The State Board may delegate to the President the power to make an initial approval, with final approval to be made by the State Board. A course taught without such approval will not yield any full‑time equivalent students, as defined by the State Board. Community colleges shall report full‑time equivalent (FTE) student hours for correction education programs on the basis of student membership hours. Funds appropriated for community college courses for prison inmates shall be used only for inmates in State prisons. The first priority for the use of these funds shall be to restore the FTE for basic skills courses to the FY 2008‑2009 level. Funds not needed for this purpose may be used for continuing education and curriculum courses related to job skills training. No community college shall operate a multi‑entry/multi‑exit class or program in a prison facility, except for a literacy class or program. The State Board shall work with the Division of Adult Correction and Juvenile Justice of the Department of Public Safety on offering classes and programs that match the average length of stay of an inmate in a prison facility.



(b)        Courses in Federal Prisons. – Courses in federal prisons shall not earn regular budget full‑time equivalents but may be offered on a self‑supporting basis.



§ 115D‑10.35.  Teacher residency licensure courses.



The North Carolina Community College System may offer courses, in accordance with Article 17D of Subchapter V of Chapter 115C of the General Statutes, to individuals who choose to enter the teaching profession through residency licensure.



§ 115D‑10.40.  American Sign Language courses.



The State Board of Community Colleges shall develop curriculum and continuing education standards for courses of instruction in American Sign Language and shall encourage community colleges to offer courses in American Sign Language as a modern foreign language.



§ 115D‑10.45.  Adult high school equivalency diploma test.



The State Board of Community Colleges may establish, retain, and budget fees charged to students taking an adult high school equivalency diploma test, including fees for retesting. Fees collected for this purpose shall be used only to (i) offset the costs of the test, including the cost of scoring the test, (ii) offset the costs of printing adult high school equivalency diplomas, and (iii) meet federal and State reporting requirements related to the test.



§ 115D‑10.50.  Motorcycle Safety Instruction Program.



(a)        There is created a Motorcycle Safety Instruction Program for the purpose of establishing statewide motorcycle safety instruction to be delivered through the Community Colleges System Office. The Program may be administered by a motorcycle safety coordinator who shall be responsible for the planning, curriculum, and completion requirements of the Program. The State Board of Community Colleges may elect a motorcycle safety coordinator upon nomination of the President of the Community College System, and the compensation of the motorcycle safety coordinator shall be fixed by the State Board upon recommendation of the President of the Community College System pursuant to G.S. 115D‑3. The State Board of Community Colleges may contract with an appropriate public or private agency or person to carry out the duties of the motorcycle safety coordinator.



(b)        The Motorcycle Safety Instruction Program shall be implemented through the Community Colleges System Office at institutions which choose to provide the Program. The motorcycle safety coordinator shall select and facilitate the training and certification of instructors who will implement the Program.



Part 4. Students.



§ 115D‑10.65.  Accreditation of secondary school located in North Carolina shall not be a factor in admissions, loans, scholarships, or other educational policies.



(a)        For purposes of this section, the term accreditation shall include certification or any other similar approval process.



(b)        The State Board of Community Colleges shall adopt a policy that prohibits any community college from soliciting or using information regarding the accreditation of a secondary school located in North Carolina that a person attended as a factor affecting admissions, loans, scholarships, or other educational activity at the community college, unless the accreditation was conducted by a State agency.



§ 115D‑10.70.  Driving eligibility certificates.



(a)        The State Board of Community Colleges shall adopt the following rules to assist community colleges in their administration of procedures necessary to implement G.S. 20‑11 and G.S. 20‑13.2:



(1)        To establish the procedures a person who is or was enrolled in a community college must follow and the requirements that person must meet to obtain a driving eligibility certificate.



(2)        To require the person who is required under G.S. 20‑11(n) to sign the driving eligibility certificate to provide the certificate if he or she determines that one of the following requirements is met:



a.         The person seeking the certificate is eligible for the certificate under G.S. 20‑11(n)(1) and is not subject to G.S. 20‑11(n1).



b.         The person seeking the certificate is eligible for the certificate under G.S. 20‑11(n)(1) and G.S. 20‑11(n1).



(3)        To provide for an appeal through the grievance procedures established by the board of trustees of each community college by a person who is denied a driving eligibility certificate.



(4)        To define exemplary student behavior and to define what constitutes the successful completion of a drug or alcohol treatment counseling program.



(b)        The State Board shall develop policies as to when it is appropriate to notify the Division of Motor Vehicles that a person who is or was enrolled in a community college no longer meets the requirements for a driving eligibility certificate. The State Board also shall adopt guidelines to assist the presidents of community colleges in their designation of representatives to sign driving eligibility certificates.



(c)        The State Board shall develop a form for the appropriate individuals to provide their written, irrevocable consent for a community college to disclose to the Division of Motor Vehicles that the student no longer meets the conditions for a driving eligibility certificate under G.S. 20‑11(n)(1) or G.S. 20‑11(n1), if applicable, in the event that this disclosure is necessary to comply with G.S. 20‑11 or G.S. 20‑13.2. Other than identifying under which statutory subsection the student is no longer eligible, no other details or information concerning the student's school record shall be released pursuant to this consent.



§ 115D‑10.75.  Excused absences for religious observances.



The State Board of Community Colleges shall direct each community college to adopt a policy that authorizes a minimum of two excused absences each academic year for religious observances required by the faith of a student. The policy may require that the student provide written notice of the request for an excused absence a reasonable time prior to the religious observance. The policy shall also provide that the student shall be given the opportunity to make up any tests or other work missed due to an excused absence for a religious observance.



§ 115D‑10.76.  Excused absences for National Guard service members.



The State Board of Community Colleges shall adopt a policy to be applied uniformly throughout the Community College System to provide that any student enrolled in a community college who is a National Guard service member placed onto State active duty status during an academic term shall be given an excused absence for the period of time the student is on active duty. The policy shall further provide all of the following:



(1)        The student shall be given the opportunity to make up any test or other work missed during the excused absence.



(2)        The student shall be given the option, when feasible, to continue classes and coursework during the academic term through online participation for the period of time the student is placed on active duty.



(3)        The student shall be given the option of receiving a temporary grade of incomplete (IN) or absent from the final exam (AB) for any course that the student was unable to complete as a result of being placed on State active duty status; however, the student must complete the course requirements within the period of time specified by the community college to avoid receiving a failing grade for the course.



(4)        The student shall be permitted to drop, with no penalty, any course that the student was unable to complete as a result of being placed on State active duty status.



SECTION 6.5.(b)  G.S. 115D‑20(4) reads as rewritten:



(4)      To apply the standards and requirements for admission and graduation of students and other standards established by the State Board of Community Colleges. Notwithstanding any law or administrative rule to the contrary, local community colleges are permitted to offer the following programs:



a.         Subject to the approval of the State Board of Community Colleges, local community colleges may collaborate with public school units and nonpublic schools to offer courses through the following programs:



1.         Repealed by Session Laws 2022‑71, s. 3.2, effective July 8, 2022.



2.         Academic transition pathways for qualified junior and senior high school students that lead to a career technical education certificate, diploma, or State or industry‑recognized credential and academic transition pathways for qualified freshmen and sophomore high school students that lead to a career technical education certificate or diploma in (i) industrial and engineering technologies, (ii) agriculture and natural resources, (iii) transportation technology, (iv) construction, or (v) business technologies.



3.         College transfer pathways requiring the successful completion of 30 semester credit hours of transfer courses, including English and mathematics, for the following students:



I.          Qualified junior and senior high school students.



II.        Qualified freshman and sophomore high school students, if all of the following requirements are met:



A.        The student is determined to be academically gifted, have a demonstrated readiness for the course material, and have the maturity to justify admission to the community college by (i) the community college president, (ii) the student's high school principal or equivalent administrator, and (iii) the academically gifted coordinator, if one is employed by the high school or local school administrative unit.



B.        The student participates in academic advising focused on the implications of being admitted to college early with representatives from the high school and the community college.



C.        The student's parent or guardian has given consent for the student to participate.



a1.       Subject to the approval of the State Board of Community Colleges, local community colleges may collaborate with local school administrative units to offer cooperative innovative high school programs, as provided by Part 9 of Article 16 of Chapter 115C of the General Statutes.



b.         During the summer quarter, persons less than 16 years old may be permitted to take noncredit courses on a self‑supporting basis, subject to rules of the State Board of Community Colleges.



c.         High school students may be permitted to take noncredit courses in safe driving on a self‑supporting basis during the academic year or the summer.



d.         High school students 16 years and older may be permitted to take noncredit courses, except adult basic skills, subject to rules promulgated by the State Board of Community Colleges.



e.         Notwithstanding any other provision of this subdivision, qualified youth 15 years and older may be permitted to enroll in courses, including certification‑eligible courses, in fire training pursuant to G.S. 95‑25.5(n) and on a specialized course list approved by the State Board of Community Colleges in accordance with G.S. 115D‑5(b)(2).



SECTION 6.5.(c)  Article 2 of Chapter 115D of the General Statutes is amended by adding a new section to read:



§ 115D‑21.2.  Accreditation.



(a)        Definitions. – The following definitions apply in this section:



(1)        Accreditation cycle. – The period of time during which a community college is accredited.



(2)        Accrediting agency. – An agency or association that accredits institutions of higher education.



(3)        Regional accrediting agency. – One of the following accrediting agencies:



a.         Higher Learning Commission.



b.         Middle States Commission on Higher Education.



c.         New England Commission on Higher Education.



d.         Northwest Commission on Colleges and Universities.



e.         Southern Association of Colleges and Schools Commission on Colleges.



f.          Western Association of Schools and Colleges Accrediting Commission for Community and Junior Colleges.



(b)        Prohibit Consecutive Accreditation by an Accrediting Agency. – A community college shall not receive accreditation by an accrediting agency for consecutive accreditation cycles except as provided in subsection (c) of this section.



(c)        Accreditation Transfer Procedure. – A community college that pursues accreditation with a different accrediting agency in accordance with this section shall pursue accreditation with a regional accrediting agency. If the community college is not granted candidacy status by any regional accrediting agency that is different from its current accrediting agency at least three years prior to the expiration of its current accreditation, the community college may remain with its current accrediting agency for an additional accreditation cycle.



(d)       Certain Programs Exempt. – The requirements of this section do not apply to professional, departmental, or certificate programs at community colleges that have specific accreditation requirements or best practices, as identified by the State Board of Community Colleges.



(e)        Cause of Action. – A community college may bring a civil action, as follows:



(1)        Against any person who makes a false statement to the accrediting agency of the community college, if all of the following criteria are met:



a.         The statement, if true, would mean the community college is out of compliance with its accreditation standards.



b.         The person made the statement with knowledge that the statement was false or with reckless disregard as to whether it was false.



c.         The accrediting agency conducted a review of the community college as a proximate result of the statement.



d.         The review caused the community college to incur costs.



(2)        A community college that prevails on a cause of action initiated pursuant to this subsection shall be entitled to the following:



a.         Costs related to the review conducted by the accrediting agency, including for the following:



1.         Additional hours worked by community college personnel.



2.         Contracted services, including outside legal counsel.



3.         Travel, lodging, and food expenses.



4.         Fees required by the agency.



b.         Reasonable attorneys' fees.



c.         Court costs.



SECTION 6.5.(d)  G.S. 115D‑21.5 is repealed.



SECTION 6.5.(e)  Article 2 of Chapter 115D of the General Statutes is amended by adding a new section to read:



§ 115D‑21.10.  Curriculum courses taught throughout year.



Community colleges may teach curriculum courses at any time during the year, including the summer term. Student membership hours from these courses shall be counted when computing full‑time equivalent students (FTE) for use in budget funding formulas at the State level.



SECTION 6.5.(f)  Chapter 115D of the General Statutes is amended by adding a new Article to read:



Article 2B.



High School Programs.



§ 115D‑30.1.  Career and College Promise Program.



(a)        There is established the Career and College Promise Program to allow pathways for qualified high school students to take community college courses without the payment of tuition.



(b)        Subject to the approval of the State Board of Community Colleges, local community colleges may collaborate with public school units and nonpublic schools to offer courses through the following programs:



(1)        Academic transition pathways for qualified junior and senior high school students that lead to a career technical education certificate, diploma, or State or industry‑recognized credential and academic transition pathways for qualified freshmen and sophomore high school students that lead to a career technical education certificate or diploma in one of the following:



a.         Industrial and engineering technologies.



b.         Agriculture and natural resources.



c.         Transportation technology.



d.         Construction.



e.         Business technologies.



(2)        College transfer pathways requiring the successful completion of 30 semester credit hours of transfer courses, including English and mathematics, for the following students:



a.         Qualified junior and senior high school students.



b.         Qualified freshmen and sophomore high school students, if all of the following requirements are met:



1.         The student is determined to be academically gifted, have a demonstrated readiness for the course material, and have the maturity to justify admission to the community college by (i) the community college president, (ii) the student's high school principal or equivalent administrator, and (iii) the academically gifted coordinator, if one is employed by the high school or local school administrative unit.



2.         The student participates in academic advising focused on the implications of being admitted to college early with representatives from the high school and the community college.



3.         The student's parent or guardian has given consent for the student to participate.



§ 115D‑30.5.  Evaluation of Career and College Promise Program.



(a)        Evaluation. – In addition to the evaluation of cooperative innovative high schools by the State Board of Education pursuant to G.S. 115C‑238.55, the State Board of Community Colleges, in conjunction with the State Board of Education and the Board of Governors of The University of North Carolina, shall evaluate the success of students participating in the Career and College Promise Program, including the College Transfer pathway and the Career and Technical Education pathway.



(b)        Metrics. – Success shall be measured by high school retention rates, high school completion rates, high school dropout rates, certification and associate degree completion, admission to four‑year institutions, postgraduation employment in career or study‑related fields, and employer satisfaction of employees who participated in the programs. The evaluation shall also include an analysis of the cost of students participating in each of the programs within the Career and College Promise Program, including at least the following:



(1)        Total enrollment funding, the number of budgeted full‑time equivalent students, and the number of students enrolled in courses through cooperative innovative high schools, the College Transfer pathway, and the Career and Technical Education pathway.



(2)        The cost and number of waivers of tuition and registration fees provided for students enrolled in courses through cooperative innovative high schools, the College Transfer pathway, and the Career and Technical Education pathway.



(3)        Any additional costs of a student attending courses on campus if a student is not attending public school in a local school administrative unit for the majority of the student's instructional time.



(c)        Report. – The Boards shall jointly report by March 15 of each year to the Joint Legislative Education Oversight Committee, the Senate Appropriations Committee on Education/Higher Education, the House Appropriations Committee on Education, and the Fiscal Research Division of the General Assembly. The report shall be combined with the evaluation of cooperative innovative high schools required by G.S. 115C‑238.55, and the Community Colleges System Office shall be responsible for submitting the combined report.



§ 115D‑30.10.  Cooperative innovative high schools.



Subject to the approval of the State Board of Community Colleges, local community colleges may collaborate with local school administrative units to offer cooperative innovative high school programs, as provided by Part 9 of Article 16 of Chapter 115C of the General Statutes.



§ 115D‑30.15.  Noncredit courses.



Subject to rules adopted by the State Board of Community Colleges, local community colleges may provide for the following:



(1)        During the summer quarter, persons less than 16 years old may be permitted to take noncredit courses on a self‑supporting basis.



(2)        High school students may be permitted to take noncredit courses in safe driving on a self‑supporting basis during the academic year or the summer.



(3)        High school students 16 years and older may be permitted to take noncredit courses, except adult basic skills.



(4)        Notwithstanding any other provision of this Article, qualified youth 15 years and older may be permitted to enroll in courses, including certification‑eligible courses, in fire training pursuant to G.S. 95‑25.5(n) and on a specialized course list approved by the State Board of Community Colleges in accordance with G.S. 115D‑30.1.



§ 115D‑30.20.  Gateway to College Program.



The purpose of the first semester of the Gateway to College Program is to address additional support to successfully complete the Program. Students may need to take developmental courses necessary for the transition to more challenging courses; therefore, the State Board of Community Colleges shall (i) permit high school students who are enrolled in Gateway to College Programs to enroll in developmental courses based on an assessment of their individual student needs by a high school and community college staff team and (ii) include this coursework in computing the budget FTE for the colleges.



§ 115D‑30.25.  NC Career Coach Program.



(a)        Purpose. – There is established the NC Career Coach Program to place community college career coaches in high schools to assist students with determining career goals and identifying community college programs that would enable students to achieve these goals.



(b)        Memorandum of Understanding. – The board of trustees of a community college and a local board of education of a local school administrative unit within the service area of the community college shall enter into a memorandum of understanding for the placement of career coaches employed by the board of trustees of the community college in schools within the local school administrative unit. At a minimum, the memorandum of understanding shall include the following:



(1)        Requirement that the community college provides the following:



a.         Hiring, training, and supervision of career coaches. The board of trustees may include a local board of education liaison on the hiring committee to participate in the decision making regarding hiring for the coach positions.



b.         Salary, benefits, and all other expenses related to the employment of the career coach. The coach will be an employee of the board of trustees and will not be an agent or employee of the local board of education.



c.         Development of pedagogical materials and technologies needed to enhance the advising process.



d.         Criminal background checks required by the local school administrative unit for employees working directly with students.



e.         Agreement that, while on any school campus, the career coach will obey all local board of education rules and will be subject to the authority of the school building administration.



(2)        Requirement that the local school administrative unit provides the following to career coaches:



a.         Access to student records, as needed to carry out the coach's job responsibilities.



b.         Office space on site appropriate for student advising.



c.         Information technology resources, including, but not limited to, internet access, telephone, and copying.



d.         Initial school orientation and ongoing integration into the faculty and staff community.



e.         Promotion of school‑wide awareness of coach duties.



f.          Facilitation of the coach's access to individual classes and larger assemblies for the purposes of awareness building.



(c)        Application for NC Career Coach Program Funding. – The board of trustees of a community college and a local board of education of a local school administrative unit within the service area of the community college jointly may apply for available funds for NC Career Coach Program funding from the State Board of Community Colleges. The State Board of Community Colleges shall establish a process for award of funds as follows:



(1)        Advisory committee. – Establishment of an advisory committee, which shall include representatives from the NC Community College System, the Department of Public Instruction, the Department of Commerce, and at least three representatives of the business community, to review applications and make recommendations for funding awards to the State Board.



(2)        Application submission requirements. – The State Board of Community Colleges shall require at least the following:



a.         Evidence of a signed memorandum of understanding that meets, at a minimum, the requirements of this section.



b.         Evidence that the funding request will be matched with local funds in accordance with the following:



1.         Matching funds may come from public or private sources.



2.         The match amount shall be determined based on the development tier designation of the county in which the local school administrative unit is located where the career coach is assigned on the date of the award of funds by the State Board of Community Colleges according to the following:



I.          If located in a tier one county as defined in G.S. 143B‑437.08, no local match shall be required.



II.        If located in a tier two county as defined in G.S. 143B‑437.08, one dollar ($1.00) of local funds for every two dollars ($2.00) in State funds shall be required.



III.       If located in a tier three county as defined in G.S. 143B‑437.08, one dollar ($1.00) of local funds for every one dollar ($1.00) in State funds shall be required.



(3)        Awards criteria. – The State Board of Community Colleges shall develop criteria for consideration in determining the award of funds that shall include the following:



a.         Consideration of the workforce needs of business and industry in the region.



b.         Targeting of resources to enhance ongoing economic activity within the community college service area and surrounding counties.



c.         Geographic diversity of awards.



(d)       Annual Report. –



(1)        The board of trustees of a community college that employs one or more career coaches shall report annually to the State Board of Community Colleges on implementation and outcomes of the Program, including the following information:



a.         Number of career coaches employed.



b.         Number of local school administrative units served and names of schools in which career coaches are placed.



c.         Number of students annually counseled by career coaches.



d.         Impact of career coaches on student choices, as determined by a valid measure selected by the State Board of Community Colleges.



(2)        The State Board of Community Colleges shall report annually no later than October 1 to the Joint Legislative Education Oversight Committee on the following:



a.         A compilation of the information reported by the board of trustees of community colleges, as provided in subdivision (1) of this subsection.



b.         Number and names of partnership applicants for NC Career Coach Program funding.



c.         Number, names, and amounts of those awarded NC Career Coach Program funding.



SECTION 6.5.(g)  G.S. 115D‑39, 115D‑39.1, 115D‑40.1, and 115D‑40.5 are codified into Part 2 of Article 3 of Chapter 115D of the General Statutes, which shall be entitled Tuition and Fees. The remaining sections of Article 3 of Chapter 115D of the General Statutes are codified into Part 1 of Article 3 of Chapter 115D of the General Statutes, which shall be entitled Funding of Community Colleges.



SECTION 6.5.(h)  Part 2 of Article 3 of Chapter 115D of the General Statutes is amended by adding new sections to read:



§ 115D‑39.2.  Pro rata tuition and uniform registration fees.



In order to make instruction as accessible as possible to all citizens, the teaching of curricular courses and of noncurricular extension courses at convenient locations away from institution campuses as well as on campuses is authorized and shall be encouraged. A pro rata portion of the established regular tuition rate charged a full‑time student shall be charged a part‑time student taking any curriculum course. In lieu of any tuition charge, the State Board of Community Colleges shall establish a uniform registration fee, or a schedule of uniform registration fees, to be charged students enrolling in extension courses for which instruction is financed primarily from State funds.



§ 115D‑39.5.  Tuition waivers.



(a)        Allowed Tuition Waivers. – The State Board of Community Colleges shall not waive tuition and registration fees for any individuals, except the State Board may, as provided by general and uniform regulations, waive tuition and registration fees for the following:



(1)        Persons not enrolled in elementary or secondary schools taking courses leading to a high school diploma or equivalent certificate.



(2)        Courses requested by the following entities that support the organizations' training needs and are on a specialized course list approved by the State Board:



a.         Volunteer fire departments.



b.         Municipal, county, or State fire departments.



c.         Volunteer EMS or rescue and lifesaving departments.



d.         Municipal, county, or State EMS or rescue and lifesaving departments.



e.         Law enforcement, fire, or EMS or rescue and lifesaving entities serving a lake authority that was created by a county board of commissioners prior to July 1, 2012.



f.          Radio Emergency Associated Communications Teams (REACT) under contract to a county as an emergency response agency.



g.         Municipal, county, or State law enforcement agencies.



h.         Campus police agencies of private institutions of higher education certified by the Attorney General pursuant to Chapter 74G of the General Statutes.



i.          The Division of Prisons of the Department of Adult Correction and the Division of Juvenile Justice of the Department of Public Safety for the training of full‑time custodial employees and employees of the Divisions required to be certified under Article 1 of Chapter 17C of the General Statutes and the rules of the Criminal Justice and Training Standards Commission.



j.          The Eastern Band of Cherokee Indians law enforcement, fire, or EMS or rescue and lifesaving tribal government departments or programs.



k.         The Criminal Justice Standards Division of the Department of Justice for the training of criminal justice professionals, as defined in G.S. 17C‑20(6), who are required to be certified under (i) Article 1 of Chapter 17C of the General Statutes and the rules of the North Carolina Criminal Justice Education and Training Standards Commission or (ii) Chapter 17E of the General Statutes and the rules of the North Carolina Sheriffs' Education and Training Standards Commission. The waivers provided for in this sub‑subdivision apply to participants and recent graduates of the North Carolina Criminal Justice Fellows Program to obtain certifications for eligible criminal justice professions, as defined in G.S. 17C‑20(6).



(3)        Firefighters, EMS personnel, and rescue and lifesaving personnel whose duty station is located on a military installation within North Carolina for courses that support their organizations' training needs and are approved for this purpose by the State Board.



(4)        Trainees enrolled in courses conducted under the Customized Training Program.



(5)        Elementary and secondary school employees enrolled in courses in first aid or cardiopulmonary resuscitation (CPR).



(6)        All courses taken by high school students at community colleges, in accordance with this section and Article 2B of this Chapter.



(7)        Human resources development courses for any individual who (i) is unemployed, (ii) has received notification of a pending layoff, (iii) is working and is eligible for the Federal Earned Income Tax Credit (FEITC), or (iv) is working and earning wages at or below two hundred percent (200%) of the federal poverty guidelines.



(8)        Courses providing employability skills, job‑specific occupational or technical skills, or developmental education instruction to certain students who are concurrently enrolled in an eligible community college literacy course, in accordance with rules adopted by the State Board.



(9)        Courses provided to students who are participating in a pre‑apprenticeship or apprenticeship program that meets all of the following criteria:



a.         Meets one of the following:



1.         Is a registered apprenticeship program recognized by the United States Department of Labor.



2.         Is a pre‑apprenticeship program recognized and approved by the State agency administering the statewide apprenticeship program.



b.         Has a documented plan of study with courses relating to a job‑specific occupational or technical skill.



c.         Requires the participants in the program to be North Carolina high school students when entering the program.



(b)        Faculty and Staff. – The State Board shall not waive tuition and registration fees for community college faculty or staff members. Community colleges may, however, use State or local funds to pay tuition and registration fees for one course per semester for full‑time community college faculty or staff members employed for a nine‑, 10‑, 11‑, or 12‑month term. Community colleges may also use State and local funds to pay tuition and registration fees for professional development courses and for other courses consistent with the academic assistance program authorized by the State Human Resources Commission.



(c)        Annual Report. – Annually by February 1, the Community Colleges System Office shall report to the Joint Legislative Education Oversight Committee on the number and type of waivers granted pursuant to subsection (a) of this section.



SECTION 6.5.(i)  G.S. 115D‑41 is recodified as G.S. 115D‑38.5.



SECTION 6.5.(j)  G.S. 115D‑43 is recodified as G.S. 115D‑38.10.



SECTION 6.5.(k)  G.S. 115D‑44 is repealed.



SECTION 6.5.(l)  G.S. 20‑11(n) reads as rewritten:



(n)      Driving Eligibility Certificate. – A person who desires to obtain a permit or license issued under this section must have a high school diploma or its equivalent or must have a driving eligibility certificate. A driving eligibility certificate must meet the following conditions:



(1)        The person who is required to sign the certificate under subdivision (4) of this subsection must show that he or she has determined that one of the following requirements is met:



a.         The person is currently enrolled in school and is making progress toward obtaining a high school diploma or its equivalent.



b.         A substantial hardship would be placed on the person or the person's family if the person does not receive a certificate.



c.         The person cannot make progress toward obtaining a high school diploma or its equivalent.



(1a)      The person who is required to sign the certificate under subdivision (4) of this subsection also must show that one of the following requirements is met:



a.         The person who seeks a permit or license issued under this section is not subject to subsection (n1) of this section.



b.         The person who seeks a permit or license issued under this section is subject to subsection (n1) of this section and is eligible for the certificate under that subsection.



(2)        It must be on a form approved by the Division.



(3)        It must be dated within 30 days of the date the person applies for a permit or license issuable under this section.



(4)        It must be signed by the applicable person named below:



a.         The principal, or the principal's designee, of the public school in which the person is enrolled.



b.         The administrator, or the administrator's designee, of the nonpublic school in which the person is enrolled.



c.         The person who provides the academic instruction in the home school in which the person is enrolled.



c1.       The person who provides the academic instruction in the home in accordance with an educational program found by a court, prior to July 1, 1998, to comply with the compulsory attendance law.



d.         The designee of the board of directors of the charter school in which the person is enrolled.



e.         The president, or the president's designee, of the community college in which the person is enrolled.



Notwithstanding any other law, the decision concerning whether a driving eligibility certificate was properly issued or improperly denied shall be appealed only as provided under the rules adopted in accordance with G.S. 115C‑12(28), 115D‑5(a3), 115D‑10.70, or 115C‑566, whichever is applicable, and may not be appealed under this Chapter.



SECTION 6.5.(m)  G.S. 20‑13.2(c1) reads as rewritten:



(c1)    Upon receipt of notification from the proper school authority that a person no longer meets the requirements for a driving eligibility certificate under G.S. 20‑11(n), the Division must expeditiously notify the person that his or her permit or license is revoked effective on the thirtieth calendar day after the mailing of the revocation notice. The Division must revoke the permit or license of that person on the thirtieth calendar day after the mailing of the revocation notice. Notwithstanding subsection (d) of this section, the length of revocation must last for the following periods:



(1)        If the revocation is because of ineligibility for a driving eligibility certificate under G.S. 20‑11(n)(1), then the revocation shall last until the person's eighteenth birthday.



(2)        If the revocation is because of ineligibility for a driving eligibility certificate under G.S. 20‑11(n1), then the revocation shall be for a period of one year.



For a person whose permit or license was revoked due to ineligibility for a driving eligibility certificate under G.S. 20‑11(n)(1), the Division must restore a person's permit or license before the person's eighteenth birthday, if the person submits to the Division one of the following:



(1)        A high school diploma or its equivalent.



(2)        A driving eligibility certificate as required under G.S. 20‑11(n).



If the Division restores a permit or license that was revoked due to ineligibility for a driving eligibility certificate under G.S. 20‑11(n)(1), any record of revocation or suspension shall be expunged by the Division from the person's driving record. The Division shall not expunge a suspension or revocation record if a person has had a prior expunction from the person's driving record for any reason.



For a person whose permit or license was revoked due to ineligibility for a driving eligibility certificate under G.S. 20‑11(n1), the Division shall restore a person's permit or license before the end of the revocation period, if the person submits to the Division a driving eligibility certificate as required under G.S. 20‑11(n).



Notwithstanding any other law, the decision concerning whether a driving eligibility certificate was properly issued or improperly denied shall be appealed only as provided under the rules adopted in accordance with G.S. 115C‑12(28), 115D‑5(a3), 115D‑10.70, or 115C‑566, whichever is applicable, and may not be appealed under this Chapter.



SECTION 6.5.(n)  G.S. 90‑631(b) reads as rewritten:



(b)      A massage and bodywork therapy program operated by a North Carolina community college that is accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2, G.S. 115D‑21.2, is exempt from the approval process, licensure process, or both, established by the Board. The college shall certify annually to the Board that the program meets or exceeds the minimum standards for curriculum, faculty, and learning resources established by the Board. Students who complete the program shall qualify for licenses from the Board as if the program were approved, licensed, or both, by the Board.



SECTION 6.5.(o)  G.S. 93A‑4(a2) reads as rewritten:



(a2)    A certified real estate education provider shall pay a fee of ten dollars ($10.00) per licensee to the Commission for each licensee completing a postlicensing education course conducted by the school, provided that these fees shall not be charged to a community college, junior college, college, or university located in this State and accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, respectively.



SECTION 6.5.(p)  G.S. 93A‑38.5(e) reads as rewritten:



(e)      The Commission may establish a nonrefundable course application fee to be charged to private real estate education providers for the review and approval of a proposed continuing education course. The fee shall not exceed one hundred twenty‑five dollars ($125.00) per course. The Commission may charge the private real estate education providers of an approved course a nonrefundable fee not to exceed seventy‑five dollars ($75.00) for the annual renewal of course approval.



A private real estate education provider shall pay a fee of ten dollars ($10.00) per licensee to the Commission for each licensee completing an approved continuing education course conducted by the sponsor.



The Commission shall not charge a course application fee, a course renewal fee, or any other fee for a continuing education course sponsored by a community college, junior college, college, or university located in this State and accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, respectively.



SECTION 6.5.(q)  G.S. 93E‑1‑7(b2) reads as rewritten:



(b2)    The Board shall not charge a course application fee, a course renewal fee, or any other fee for a continuing education course offered by a North Carolina college, university, junior college, or community or technical college accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, respectively, or an agency of the federal, State, or local government.



SECTION 6.5.(r)  G.S. 93E‑1‑8 reads as rewritten:



§ 93E‑1‑8.  Education program approval and fees.



…



(b)        The Board may by rule set nonrefundable fees chargeable to private real estate appraisal schools or course sponsors, including appraisal trade organizations, for the approval and annual renewal of approval of their qualifying courses required by G.S. 93E‑1‑6(a), or equivalent courses. The fees shall be one hundred dollars ($100.00) per course for approval and fifty dollars ($50.00) per course for renewal of approval. No fees shall be charged for the approval or renewal of approval to conduct appraiser qualifying courses where such courses are offered by a North Carolina college, university, junior college, or community or technical college accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, respectively, or an agency of the federal, State, or local government.



…



(d)       Nonrefundable fees of one hundred dollars ($100.00) per course may be charged to schools and course sponsors for the approval to conduct appraiser continuing education courses and fifty dollars ($50.00) per course for renewal of approval. However, no fees shall be charged for the approval or renewal of approval to conduct appraiser continuing education courses where such courses are offered by a North Carolina college, university, junior college, or community or technical college accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, respectively, or by an agency of the federal, State, or local government. A nonrefundable fee of fifty dollars ($50.00) per course may be charged to current or former licensees or certificate holders requesting approval by the Board of a course for continuing education credit when approval of such course has not been previously obtained by the offering school or course sponsor.



SECTION 6.5.(s)  G.S. 95‑25.5(n) reads as rewritten:



(n)      Nothing in this section prohibits qualified youths under 18 years of age from participating in training through their fire department, the Office of State Fire Marshal, or the North Carolina Community College System. As used in this subsection, the term qualified youth under 18 years of age means an uncompensated fire department or rescue squad member who is at least the age of 15 and under the age of 18 and who is a member of a bona fide fire department, as that term is defined in G.S. 58‑86‑2(4), or of a rescue squad described in G.S. 58‑86‑2(6). A qualified youth under 18 years of age under this subsection may be permitted to enroll in courses, including certification‑eligible courses, in fire training at a community college on a specialized course list approved by the State Board of Community Colleges pursuant to G.S. 115D‑20(4)e.G.S. 115D‑30.15(4).



SECTION 6.5.(t)  G.S. 115C‑84.3(a)(3) reads as rewritten:



(3)      Institution of higher education courses, as provided in Article 16 of this Chapter or G.S. 115D‑20(4).Article 2B of Chapter 115D of the General Statutes.



SECTION 6.5.(u)  G.S. 115C‑238.55 reads as rewritten:



§ 115C‑238.55.  Evaluation of cooperative innovative high schools.



The State Board of Education and the governing Boards shall evaluate the success of students in cooperative innovative high schools approved under this Part. Success shall be measured by high school retention rates, high school completion rates, high school dropout rates, certification and associate degree completion, admission to four‑year institutions, postgraduation employment in career or study‑related fields, and employer satisfaction of employees who participated in and graduated from the schools. The Boards shall jointly report by March 15 of each year to the Joint Legislative Education Oversight Committee, the Senate Appropriations Committee on Education/Higher Education, the House Appropriations Committee on Education, and the Fiscal Research Division of the General Assembly on the evaluation of these schools. The report shall be combined with the evaluation of and analysis of cost of students participating in the Career and College Promise Program required by G.S. 115D‑5(x), G.S. 115D‑30.5, and the Community Colleges System Office shall be responsible for submitting the combined report.



SECTION 6.5.(v)  G.S. 115D‑2(2) reads as rewritten:



(2)      The term community college is defined as an educational institution operating under the provisions of this Chapter and dedicated primarily to the educational needs of the service area which it serves, and may offer any of the following:



a.         The freshmen and sophomore courses of a college of arts and sciences, authorized by G.S. 115D‑4.1;G.S. 115D‑10.10.



b.         Organized credit curricula for the training of technicians; curricular courses may carry transfer credit to a senior college or university where the course is comparable in content and quality and is appropriate to a chosen course of study;study.



c.         Vocational, trade, and technical specialty courses and programs, andprograms.



d.         Courses in general adult education.



SECTION 6.5.(w)  G.S. 115D‑39(a1) reads as rewritten:



(a1)    In addition, federal law enforcement officers, firefighters, EMS personnel, and rescue and lifesaving personnel whose permanent duty station is within North Carolina and who do not otherwise qualify for tuition waivers under G.S. 115D‑5(b)(2a) G.S. 115D‑39.5(a)(3) shall also be eligible for the State resident community college tuition rate for courses that support their organizations' training needs and are approved for this purpose by the State Board of Community Colleges.



SECTION 6.5.(x)  G.S. 115D‑41(a) reads as rewritten:



(a)      Community college contracts with local school administrative units shall not be used by these agencies to supplant funding for a public school high school teacher providing courses offered pursuant to G.S. 115D‑20(4) Article 2B of this Chapter who is already employed by the local school administrative unit. In no event shall a community college contract with a local school administrative unit to provide high school level courses.



SECTION 6.5.(y)  Article 6A of Chapter 115D of the General Statutes is repealed.



SECTION 6.5.(z)  G.S. 116‑201(b)(8) reads as rewritten:



(8)      Private institution means an institution other than a seminary, Bible school, Bible college or similar religious institution in this State that is not owned or operated by the State or any agency or political subdivision thereof, or by any combination thereof, that offers post‑high school education and is accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, or the Transnational Association of Christian Colleges and Schools, or, in the case of institutions that are not eligible to be considered for accreditation, accredited in those categories and by those nationally recognized accrediting agencies that the Authority may designate;



SECTION 6.5.(aa)  G.S. 116‑280(3) reads as rewritten:



(3)      Eligible private postsecondary institution. – A school that is any of the following:



a.         A nonprofit postsecondary educational institution with a main permanent campus located in this State that is not owned or operated by the State of North Carolina or by an agency or political subdivision of the State or by any combination thereof that satisfies all of the following:



1.         Is either (i) accredited by a regional accrediting agency, as defined in G.S. 115D‑6.2 G.S. 115D‑21.2 and G.S. 116‑11.4, or the Transnational Association of Christian Colleges and Schools or (ii) was accredited by SACSCOC the Southern Association of Colleges and Schools Commission on Colleges on January 1, 2021, and, beginning January 1, 2021, was a member of the Transnational Association of Christian Colleges and Schools.



2.         Awards a postsecondary degree as defined in G.S. 116‑15.



b.         A postsecondary institution owned or operated by a hospital authority as defined in G.S. 131E‑16(14) or school of nursing affiliated with a nonprofit postsecondary educational institution as defined in sub‑subdivision a. of this subsection.



SECTION 6.5.(bb)  G.S. 126‑5(c2)(3) reads as rewritten:



(3)      Employees of community colleges whose salaries are fixed in accordance with G.S. 115D‑5 G.S. 115D‑6.1 and G.S. 115D‑20 and employees of the Community Colleges System Office whose salaries are fixed by the State Board of Community Colleges in accordance with G.S. 115D‑3.



SECTION 6.5.(cc)  Section 6.9(b) of S.L. 2023‑134 reads as rewritten:



SECTION 6.9.(b)  Of the recurring funds appropriated in this act to the Community Colleges System Office for the 2023‑2025 fiscal biennium to support increasing program offerings for individuals with IDD pursuant to G.S. 115D‑44, as enacted by this section, G.S. 115D‑10.21, the System Office shall establish at least two statewide positions for program support, provide professional development training for college advising staff to assist students with IDD for career pathway exploration and the identification of credentials leading to competitive employment, and explore funding sources to sustain programs for students with IDD.



 



NCCCS Learning Management System



SECTION 6.6.(a)  The State Board of Community Colleges shall conduct a competitive solicitation, including a request for information or a request for proposals, to provide a learning management system to all community colleges. The competitive solicitation shall be completed by December 31, 2025. Answers to the competitive solicitation shall include information on how the learning management system would align with the learning management systems (i) offered by the Department of Public Instruction to local school administrative units and (ii) used by the constituent institutions of The University of North Carolina.



SECTION 6.6.(b)  By December 31, 2025, the State Board shall report to the Senate Appropriations Committee on Education/Higher Education, the House Appropriations Committee on Education, and the Fiscal Research Division on the information received.



SECTION 6.6.(c)  G.S. 143B‑1320 reads as rewritten:



§ 143B‑1320.  Definitions; scope; exemptions.



(a)        Definitions. – The following definitions apply in this Article:



(1)        CGIA. – Center for Geographic Information and Analysis.



…



(17)      State agency or agency. – Any agency, department, institution, commission, committee, board, division, bureau, office, unit, officer, or official of the State. The term does not include the legislative or judicial branches of government government, the Community Colleges System Office, or The University of North Carolina.



…



(b)        Exemptions. – Except as otherwise specifically provided by law, the provisions of this Chapter do not apply to the following entities: the General Assembly, the Judicial Department, the Community Colleges System Office, and The University of North Carolina and its constituent institutions. These entities may elect to participate in the information technology programs, services, or contracts offered by the Department, including information technology procurement, in accordance with the statutes, policies, and rules of the Department. The election must be made in writing, as follows:



(1)        For the General Assembly, by the Legislative Services Commission.



(2)        For the Judicial Department, by the Chief Justice.



(2a)      For the Community Colleges System Office, by the State Board of Community Colleges.



(3)        For The University of North Carolina, by the Board of Governors.



(4)        For the constituent institutions of The University of North Carolina, by the respective boards of trustees.



….



 



Fiscal Responsibility and Community College Tech Planning



SECTION 6.7.  Chapter 115D of the General Statutes is amended by adding a new section to read:



§ 115D‑9.40.  Evaluation of technology costs.



The State Board of Community Colleges shall adopt a policy that requires all community colleges to evaluate the following when acquiring technology, computer hardware, and software:



(1)        The long‑term cost of ownership, including costs of repairing the technology, computer hardware, or software.



(2)        Any flexibility for innovation during the life of the technology, computer hardware, or software.



(3)        Any anticipated resale or salvage value at the end of the target life cycle for the technology, computer hardware, or software based on the average resale or salvage value of similar technology, computer hardware, or software as a percentage of the initial cost of purchase.



 



COMMUNITY COLLEGE SEAMLESS SKILLS INITIATIVE



SECTION 6.8.(a)  Initiative Established; Purpose. – There is established the Community College Seamless Skills Initiative (Initiative). The purpose of the Initiative is to create a competency‑based education (CBE) model that seamlessly connects high school and community college. By aligning learning experiences from high school with college‑level competencies, the Initiative enables students to explore career pathways, earn dual credit, and fulfill computer science requirements while gaining credentials of value in high‑demand technology employment sectors through college credit.



SECTION 6.8.(b)  Initiative Participants. – Fayetteville Technical Community College (FTCC) and Wilkes Community College (WCC) shall partner to implement the duties of the Initiative.



SECTION 6.8.(c)  Project Commitments. – The Project shall commit to accomplishing each of the following:



(1)        Establish high‑tech pathways that will integrate high school and community college curricula for hands‑on, project‑based learning.



(2)        Develop competency‑based pathways that will create cross‑curricular maps for dual credit, fostering seamless transitions between secondary and postsecondary education.



(3)        Scale and replicate to be able to build a scalable framework for rapid implementation across North Carolina.



(4)        Empower student ownership by enabling students to set long‑term learning goals and to manage and own their credentials with a digital wallet.



(5)        Facilitate student work experiences to accelerate learning and transition students into work through learn & earn work‑based learning in partnership with public agencies and private employers.



(6)        Address workforce needs by developing and sustaining a comprehensive talent pipeline of skilled workers for high‑demand technology fields in occupations that depend upon informational technology and operational technology for operational success.



(7)        Develop statewide resources, including a guidebook to facilitate model replication and a new talent development model to accelerate learning using CBE.



SECTION 6.8.(d)  Digital Wallet. – The participants in the Initiative shall contract with a third‑party entity to create a secure, interoperable digital wallet platform capable of issuing, storing, verifying, and sharing learner credentials, including microcredentials, certifications, transcripts, and verified skill records. The platform shall allow for credential portability across educational institutions and employers, support open standards for interoperability, and ensure privacy and security in compliance with applicable laws. The system shall enable learners to manage a comprehensive, lifelong record of achievement that is accessible, verifiable, and shareable with third parties through digital means. All credential and learner data shall be owned and controlled by the student and shall not be stored in centralized cloud infrastructure.



SECTION 6.8.(e)  Support. – The Community Colleges System Office shall provide ongoing technical support to community colleges participating in the Initiative. FTCC shall enter into a memorandum of understanding with WCC to jointly co‑design the Program. As part of this effort, the colleges shall engage an organization with demonstrated expertise in designing and implementing learner‑centered, modular, and competency‑based high school programs aligned with emerging and high‑tech career pathways. The selected organization shall have a history of co‑designing stackable credentials with local education agencies and postsecondary institutions and a proven track record of building digital infrastructure that supports student‑paced progression, interdisciplinary instruction, and authentic skill development. The organization shall assist in the development of a comprehensive framework for the Program, including course design, sequencing, credentialing structure, and related elements necessary to support personalized student progression during the 2025‑2026 school year.



SECTION 6.8.(f)  Of the funds appropriated from the General Fund to the Community Colleges System Office for the purposes in this section, the sum of two million seven hundred fifty thousand dollars ($2,750,000) shall be allocated to FTCC and the sum of one million dollars ($1,000,000) shall be allocated to WCC. Funds allocated for the purposes outlined in this section shall not revert but shall remain available until the end of the 2028‑2029 fiscal year.



 



HIgh‑Cost WOrkforce Programs start‑up funds



SECTION 6.9.(a)  Establishment of the Fund. – Of the funds appropriated to the Community Colleges System Office (System Office) by this act for the 2025‑2027 fiscal biennium, the System Office shall establish the Fund for High‑Cost Workforce Programs (Fund). Any unexpended funds remaining in the Fund at the end of the fiscal year shall not revert to the General Fund but shall remain available for the purposes set forth in this section. The Fund shall be used to assist community colleges in starting new programs in high‑demand career fields that require significant start‑up funds. Only programs offered at community colleges aligned with high salary and high demand workforce sectors shall be eligible for the award of funds.



SECTION 6.9.(b)  Applications. – The System Office shall establish an application process for community colleges to apply for awards from the Fund no later than the beginning of each year of the 2025‑2027 fiscal biennium. To be eligible to receive funds, colleges shall submit to the System Office a completed application, which shall include at least the following information:



(1)        A description of the proposed new program requiring start‑up funds.



(2)        Documentation of industry demand for the program or documentation of future local, regional, or statewide employment needs that will be met by the program.



(3)        Total cash cost to start the program and maintain the program over two fiscal years.



(4)        A plan for the fiscal sustainability of the new program.



SECTION 6.9.(c)  Limitation on the Use of Funds. – A community college may only apply for the award of funds to support one new program in each fiscal year. Funds shall remain available to the community college for a period of two fiscal years.



SECTION 6.9.(d)  Matching Funds. – A community college shall be required to match a percentage of the total cash cost of the program with non‑State funds based on a college's total full‑time equivalents (FTE) according to the following:



(1)        Community colleges with a total FTE of greater than 6,500 shall be required to match fifteen percent (15%) of the cost.



(2)        Community colleges with a total FTE between 2,500 and 6,500 shall be required to match ten percent (10%) of the cost.



(3)        Community colleges with a total FTE below 2,500 shall be required to match five percent (5%) of the cost.



SECTION 6.9.(e)  Administration. – The System Office may adopt any regulations, policies, or procedures regarding the application process, use of funds, eligibility requirements, and any other rules necessary related to the administration of the Fund. The System Office may use up to one hundred thousand dollars ($100,000) each fiscal year for administrative costs for establishing and implementing the program.



SECTION 6.9.(f)  Report. – The System Office shall submit an initial report to the Joint Legislative Education Oversight Committee by December 1, 2026, and an annual report thereafter for each year the System Office provides funds to community colleges from the Fund on the programs receiving the funds, which shall include at least the following information:



(1)        The community colleges that received funds, the amount of funds, and the types of programs started.



(2)        The use of funds by community colleges receiving awards, including costs associated with student instruction, faculty salaries, instructional supplies, related instructional equipment, and accreditation costs.



(3)        Evaluation of the success of the new community college programs receiving funds.



 



NO financial benefit FOR CC STUDENTS CONVICTED OF ASSAULTING OFFICERS OR EMPLOYEES OF THE STATE



SECTION 6.10.(a)  G.S. 115D‑5 is amended by adding a new subsection to read:



(aa)     The State Board of Community Colleges shall adopt a policy prohibiting the Community Colleges System Office and community colleges from providing a State‑funded scholarship or grant to any student who has been convicted of assaulting an officer or employee of the State or any political subdivision of the State, as provided in G.S. 14‑33(c)(4), while enrolled as a student. The prohibition begins with the semester or academic term following the conviction.



SECTION 6.10.(b)  This section is effective December 1, 2025, and applies to offenses committed on or after that date.



 



PART VII. PUBLIC INSTRUCTION



 



REPEAL TEACHNC Initiative



SECTION 7.1.  Section 7.20 of S.L. 2021‑180 is repealed.



 



Repeal LEARNING.COM FUNDING



SECTION 7.2.(a)  Subsection (c) of Section 7.23K of S.L. 2017‑57, as amended by Section 7.7 of S.L. 2018‑5 and Section 7.17 of S.L. 2023‑134, is repealed.



SECTION 7.2.(b)  Section 2 of S.L. 2020‑49 is repealed.



SECTION 7.2.(c)  Section 7.83 of S.L. 2021‑180 is repealed.



 



REPEAL PLASMA GAMES Program



SECTION 7.3.  Section 7.69 of S.L. 2023‑134, as amended by Section 2.8F of S.L. 2024‑1, is repealed.



 



REPEAL requirement FOR CONTRACT WITH COLLEGE BOARD FOR ADVANCED PLACEMENT PROFESSIONAL DEVELOPMENT



SECTION 7.4.(a)  Subsections (f) and (g) of G.S. 115C‑174.26 are repealed.



SECTION 7.4.(b)  Subsection (h) of G.S. 115C‑174.26 reads as rewritten:



(h)      The State Board of Education shall report annually by December 15 to the Joint Legislative Education Oversight Committee on advanced courses in North Carolina. The report shall include, at a minimum, the following information:



(1)        The North Carolina Advanced Placement Partnership's report to the Department of Public Instruction as required by subsection (g) of this section and the State Board's assessment of that report.



(2)        Number of students enrolled in advanced courses and participating in advanced course examinations, including demographic information by gender, race, and free and reduced‑price lunch status.



(3)        Student performance on advanced course examinations, including information by course, local school administrative unit, and school.



(4)        Number of students participating in 10th grade PSAT/NMSQT testing.



(5)        Number of teachers attending summer institutes offered by the North Carolina Advanced Placement Partnership.



(6)        Distribution of funding appropriated for advanced course testing fees and professional development by local school administrative unit and school.



(7)        Status and efforts of the North Carolina Advanced Placement Partnership.



(8)        Other trends in advanced courses and examinations.



 



REPEAL BEGINNINGS report



SECTION 7.5.  Subsection (b) of Section 7.28 of S.L. 2023‑134 is repealed.



 



REPEAL SCHOOLS THAT LEAD PROGRAM



SECTION 7.6.  Section 7.11 of S.L. 2021‑180 is repealed.



 



Modify Eligibility to receive AP, IB, AND AICE TEST FEES



SECTION 7.7.  G.S. 115C‑174.26(a) reads as rewritten:



(a)      It is the intent of the State to enhance accessibility and encourage students to enroll in and successfully complete more rigorous advanced courses to enable success in postsecondary education for all students. For the purposes of this section, an advanced course is an Advanced Placement course, an International Baccalaureate Diploma Programme course, or a Cambridge Advanced International Certificate of Education (AICE) course, including an AS‑Level or A‑Level course. To attain this goal, to the extent funds are made available for this purpose, economically disadvantaged students enrolled in public schools shall be exempt from paying any fees for administration of examinations for advanced courses and registration fees for advanced courses in which the student is enrolled regardless of the score the student achieves on an examination. A student receiving instruction through a home school, as provided by Part 3 of Article 39 of this Chapter, shall be eligible to participate in administration of examinations for advanced courses as provided in G.S. 115C‑565.1.



 



Streamline Limited English Proficient Allotment



SECTION 7.8.(a)  The title of Article 32F of Chapter 115C of the General Statutes reads as rewritten:



Supplemental School Funding.Funding and Other Allotments.



SECTION 7.8.(b)  Article 32F of Chapter 115C of the General Statutes is amended by adding a new section to read:



§ 115C‑472.30.  Limited English proficient allotment.



To the extent funds are made available for this purpose, the State Board of Education shall allocate funds to local school administrative units, charter schools, regional schools, and laboratory schools operated under Article 29A of Chapter 116 of the General Statutes to provide services to students with limited English proficiency. The State Board shall allocate these funds under a formula that takes into account the average number of students in the units, charters, regional schools, or laboratory schools over the past three years who have limited English proficiency. Local school administrative units shall use funds allocated to them to pay for classroom teachers, teacher assistants, tutors, textbooks, classroom materials/instructional supplies/equipment, transportation costs, and professional development of teachers for students with limited English proficiency. A county in which a local school administrative unit receives funds under this section shall use the funds to supplement local current expense funds and shall not supplant local current expense funds.



SECTION 7.8.(c)  When making adjustments to allocations to local school administrative units from the limited English proficient allotment for the 2025‑2026 fiscal year, no local school administrative unit with an average daily membership of 20,000 or fewer students for the 2025‑2026 school year shall receive a negative adjustment in excess of fifty thousand dollars ($50,000) when compared to the allocation received during the 2024‑2025 fiscal year from that allotment.



 



Repeal Textbook Commission



SECTION 7.9.(a)  G.S. 115C‑86 through G.S. 115C‑95 and G.S. 115C‑97 are repealed.



SECTION 7.9.(b)  Part 3 of Article 8 of Chapter 115C of the General Statutes reads as rewritten:



Part 3. Textbooks.Instructional Materials.



§ 115C‑85.  Textbook Instructional material needs are determined by course of study.



When the State Board of Education has adopted, upon the recommendation of the Superintendent of Public Instruction, a standard course of study at each instructional level in the elementary school and the secondary school, setting forth what subjects shall be taught at each level, it shall proceed to select and adopt textbooks.



As used in this part, textbook instructional materials means systematically organized material comprehensive enough to cover the primary objectives outlined in the standard course of study for a grade or course. Formats for textbooks instructional materials may be print or nonprint, including hardbound books, softbound books, activity‑oriented programs, classroom kits, and technology‑based programs digital resources that require the use of electronic equipment in order to be used in the learning process.



Textbooks adopted in accordance with the provisions of this Part shall be used by the public schools of the State except as provided in G.S. 115C‑98(b1).



…



§ 115C‑96.  Powers and duties of the State Board of Education in regard to textbooks.instructional materials.



(a)        The children of the public elementary and secondary schools of the State shall be provided with free basic textbooks instructional materials within the appropriation of the General Assembly for that purpose. To implement this directive, the State Board of Education shall evaluate annually the amount of money necessary to provide textbooks instructional materials based on the actual cost and availability of textbooks the instructional materials and shall request sufficient appropriations from the General Assembly.



(b)        The State Board of Education shall administer a fund and establish adopt rules and regulations necessary to:



(1)        Acquire by contract such basic textbooks as are or may be on the adopted list of the State of North Carolina which the Board finds necessary to meet the needs of the State public school system and to carry out the provisions of this Part.



(2)        Provide a system of distribution of these textbooks and distribute the books that are provided without using any depository or warehouse facilities other than those operated by the State Board of Education.



(3)        Provide for the free use, with proper care and return, of elementary and secondary basic textbooks. instructional materials. The title of said books the instructional materials shall be vested in the State.



…



§ 115C‑98.  Local boards of education to provide for local operation of the textbook program, the selection and procurement of other instructional materials, and the use of nonadopted textbooks.selection of supplementary and instructional materials.



(a)        Local boards of education shall adopt rules policies not inconsistent with the policies rules of the State Board of Education concerning the local operation of the textbook program.selection and procurement of instructional materials.



(b)        Local boards of education shall adopt written policies concerning the procedures to be followed in their local school administrative units for the selection and procurement of supplementary textbooks, library books, periodicals, audiovisual materials, and other supplementary and instructional materials needed for instructional purposes in the public schools of their units.



Local boards of education shall have sole authority to select and procure supplementary and instructional materials, including library books and media, whether or not the materials contain commercial advertising, to determine if the materials are related to and within the limits of the prescribed curriculum, and to determine when the materials may be presented to students during the school day. Supplementary materials and contracts for supplementary materials are not subject to approval by the State Board of Education.



Supplementary books and other instructional materials shall neither displace nor be used to the exclusion of basic textbooks.instructional materials.



(b1)      A local board of education may establish a community media advisory committee to investigate and evaluate challenges from parents, teachers, and members of the public to textbooks and supplementary instructional materials on the grounds that they are educationally unsuitable, pervasively vulgar, or inappropriate to the age, maturity, or grade level of the students. The State Board of Education shall review its rules and policies concerning these challenges and shall establish guidelines to be followed by community media advisory committees.



The local board, at all times, has sole authority and discretion to determine whether a challenge has merit and whether challenged material should be retained or removed.



(b2)      Local boards of education may:



(1)        Select, procure, and use textbooks that have not been adopted by the State Board of Education for use throughout the local school administrative unit for selected grade levels and courses; and



(2)        Approve school improvement plans developed under G.S. 115C‑105.27 that include provisions for using textbooks that have not been adopted by the State Board of Education for selected grade levels and courses.



All textbook instructional material contracts made under this subsection shall include a clause granting to the local board of education the license to produce braille, large print, and audiocassette tape tape, and other accessible copies of the textbooks instructional materials for use in the local school administrative unit.



…



§ 115C‑98.5.  Challenges to supplementary and instructional materials.



(a)        Local boards of education shall establish a community media advisory committee to investigate and evaluate challenges to supplementary and instructional materials.



(b)        At a minimum, the committee shall include the following:



(1)        A principal from a high school, middle school, and elementary school, respectively.



(2)        A teacher from a high school, middle school, and elementary school, respectively.



(3)        A parent of a student in high school or middle school and a parent of a student in elementary school.



(4)        A school library media coordinator from a high school, middle school, and elementary school, respectively.



(c)        Challenges to instructional and supplemental materials shall be made in writing and submitted to the local board of education. The challenge shall specify that the material being challenged is one or more of the following:



(1)        Obscene.



(2)        Inappropriate to the age, maturity, or grade level of the students.



(3)        Not aligned with the standard course of study.



(d)       The local board of education and the media advisory committee shall only investigate and evaluate challenges submitted by a parent of a student enrolled in a school governed by the board, a teacher employed by the board, or a resident of the area of assignment for the board.



(e)        Within two weeks of the filing of the challenge, the media advisory committee shall hold a hearing and provide the challengers an opportunity to present their concerns to the committee. The committee may, in the committee's discretion, request additional information on the subject matter at the hearing from experts employed by the local school administrative unit. Within two weeks of the hearing, the committee shall make a recommendation to the local board of education on whether the challenge has merit and whether the challenged material should be retained or removed as unfit material. The committee's determination shall be limited to considerations of whether the material is unfit on the specific grounds of the material being (i) obscene, (ii) inappropriate to the age, maturity, or grade level of the students, or (iii) not aligned with the standard course of study.



(f)        At the next meeting of the local board of education after the media advisory committee's recommendation is received, the local board shall determine whether the challenge has merit and whether the challenged material should be retained or removed as unfit material.



(g)        The local board, at all times, has sole authority and discretion to determine whether a challenge has merit and whether challenged material should be retained or removed. The decision of the board is not appealable.



§ 115C‑99.  Legal custodians of textbooks instructional materials furnished by State.



Local boards of education are the custodians of all textbooks instructional materials purchased by the local boards with State funds. They shall provide adequate and safe storage facilities for the proper care of these textbooks the instructional materials and emphasize to all students the necessity for proper care of textbooks.instructional materials.



§ 115C‑100.  Rental fees for textbooks instructional materials prohibited; damage fees authorized.



No local board of education may charge any pupil a rental fee for the use of textbooks. instructional materials. A pupil's parents or legal guardians may be charged damage fees for abuse or loss of textbooks instructional materials under rules adopted by the State Board of Education. All money collected from the sale of textbooks instructional materials purchased with State funds under the provisions of this Part shall be paid annually as collected to the State Board of Education.



§ 115C‑101.  Duties and authority of superintendents of local school administrative units.



The superintendent of each local school administrative unit, as an official agent of the State Board of Education, shall administer the provisions of this Part and the rules and regulations of the Board insofar as they apply to his the local school administrative unit. The superintendent of each local school administrative unit shall have authority to require the cooperation of principals and teachers so that the children may receive the best possible service, and so that all the books instructional materials and moneys may be accounted for properly. If any principal or teacher fails to comply with the provisions of this section, his the superintendent shall withhold his the salary vouchers of the principal until the duties imposed by this section have been performed.



If any superintendent fails to comply with the provisions of this section, the State Superintendent, as secretary to the State Board of  Education, shall notify the State Board of Education and the State Treasurer. The State Board and the State Superintendent shall withhold the superintendent's salary vouchers, and the State Treasurer shall make no payment until the State Superintendent notifies him confirms that the provisions of this section have been complied with.



§ 115C‑102.  Right to purchase; disposal of textbooks and instructional materials.



(a)        Any parent, guardian, or person in loco parentis may purchase any instructional material needed for any child in the public schools of the State from the board of education of the local school administrative unit in which the child is enrolled or, in the case of basic textbooks, from the State Board of Education.enrolled.



(b)        Notwithstanding Article 3A of Chapter 143 of the General Statutes, G.S. 143‑49(4), or any other provision of law, the State Board of Education may adopt rules authorizing local boards of education to dispose of discontinued instructional material, including State‑adopted textbooks.material.



SECTION 7.9.(c)  G.S. 115C‑11(d) reads as rewritten:



(d)      Voting. – No voting by proxy shall be permitted. Except in voting on textbook adoptions, a A majority of those present and voting shall be necessary to carry a motion and a roll call vote shall be had on each motion. A record of all such votes shall be kept in the minute book.



SECTION 7.9.(d)  G.S. 115C‑11(e) is repealed.



SECTION 7.9.(e)  G.S. 115C‑12(9)b. is repealed.



SECTION 7.9.(f)  G.S. 115C‑12(18)d. reads as rewritten:



d.       The State Board of Education shall modify the Uniform Education Reporting System to provide clear, accurate, and standard information on the use of funds at the unit and school level. The plan shall provide information that will enable the General Assembly to determine State, local, and federal expenditures for personnel at the unit and school level. The plan also shall allow the tracking of expenditures for textbooks, instructional materials, educational supplies and equipment, capital outlay, at‑risk students, and other purposes.



SECTION 7.9.(g)  G.S. 115C‑47 reads as rewritten:



§ 115C‑47.  Powers and duties generally.



In addition to the powers and duties designated in G.S. 115C‑36, local boards of education shall have the power or duty:



…



(6)        To Regulate Fees, Charges and Solicitations. – Local boards of education shall adopt rules and regulations governing solicitations of, sales to, and fund‑raising activities conducted by, the students and faculty members in schools under their jurisdiction, and no fees, charges, or costs shall be collected from students and school personnel without approval of the board of education as recorded in the minutes of said the board; provided, this subdivision shall not apply to such textbooks instructional material fees as are determined and established by the State Board of Education. The local board of education shall publish a schedule of fees, charges, and solicitations approved by the local board on the local school administrative unit's Web site by October 15 of each school year and, if the schedule is subsequently revised, within 30 days following the revision.



…



(33)      To Approve and Use Supplemental Materials. – Local boards of education shall have sole authority to select and procure supplementary instructional materials, whether or not the materials contain commercial advertising, pursuant to the provisions of G.S. 115C‑98(b).



(33a)    To Approve and Use Textbooks Not Adopted by State Board of Education. Instructional Materials. – Local boards of education shall have the authority to select, procure, and use textbooks not adopted by the State Board of Education instructional materials as provided in G.S. 115C‑98(b1).G.S. 115C‑98.



….



SECTION 7.9.(h)  G.S. 115C‑76.55 reads as rewritten:



§ 115C‑76.55.  Age‑appropriate instruction for grades kindergarten through fourth grade.



Instruction on gender identity, sexual activity, or sexuality shall not be included in the curriculum provided in grades kindergarten through fourth grade, regardless of whether the information is provided by school personnel or third parties. For the purposes of this section, curriculum includes the standard course of study and support materials, locally developed curriculum, supplemental instruction, and textbooks and other supplementary materials, but does not include responses to student‑initiated questions.



SECTION 7.9.(i)  G.S. 115C‑81.5(b)(3) is repealed.



SECTION 7.9.(j)  G.S. 115C‑81.25(b)(3) is repealed.



SECTION 7.9.(k)  G.S. 115C‑81.25(d) reads as rewritten:



(d)      Parental Review. – The State Board of Education shall make available to all local school administrative units for review by the parents and legal guardians of students enrolled at those units any State‑developed objectives for instruction, any approved textbooks, the list of reviewed materials, and any other State‑developed or approved materials that pertain to or are intended to impart information or promote discussion or understanding in regard to the prevention of sexually transmitted diseases, including HIV/AIDS, to the avoidance of out‑of‑wedlock pregnancy, or to the reproductive health and safety education curriculum. The review period shall extend for at least 60 days before use.



SECTION 7.9.(l)  G.S. 115C‑105.25(b)(12) reads as rewritten:



(12)    Funds allotted for textbooks and digital resources instructional materials may only be used for the purchase of textbooks and digital resources. to acquire instructional and supplemental materials as identified in Part 3 of Article 8 of this Chapter and to acquire software necessary for the use of the instructional or supplemental materials. These funds shall not be transferred out of the allotment for any other purpose.



SECTION 7.9.(m)  G.S. 115C‑242(3) reads as rewritten:



(3)      The board of education of any local school administrative unit may operate the school buses of such unit one day prior to the opening of the regular school term for the transportation of pupils and employees to and from the school to which such pupils are assigned or in which they are enrolled and such employees are employed, for the purposes of the registration of students, the organization of classes, the distribution of textbooks, instructional materials, and such other purposes as will, in the opinion of the superintendent of the schools of such unit, promote the efficient organization and operation of such public schools.



SECTION 7.9.(n)  G.S. 115C‑271(d)(2) reads as rewritten:



(2)      Local funds appropriated for teachers, textbooks, instructional materials, or classroom materials, supplies, and equipment are not transferred or used for this purpose.



SECTION 7.9.(o)  G.S. 115C‑384(c) reads as rewritten:



(c)      Rental Fees for Textbooks Instructional Materials Prohibited; Damage Fees Authorized. – No rental fees are permitted for the use of textbooks, but damage fees may be collected pursuant to the provisions of G.S. 115C‑100.



SECTION 7.9.(p)  G.S. 115C‑390.2(l)(1) reads as rewritten:



(1)      The opportunity to take textbooks instructional materials and school‑furnished digital devices home for the duration of the absence.



SECTION 7.9.(q)  G.S. 115C‑390.5(c)(1) reads as rewritten:



(1)      The opportunity to take textbooks instructional materials home for the duration of the suspension.



SECTION 7.9.(r)  G.S. 115C‑398 reads as rewritten:



§ 115C‑398.  Damage to school buildings, furnishings, textbooks.instructional materials.



Students and their parents or legal guardians may be liable for damage to school buildings, furnishings and textbooks instructional materials pursuant to the provisions of G.S. 115C‑523, 115C‑100 and 14‑132.



SECTION 7.9.(s)  G.S. 143A‑48 is repealed.



SECTION 7.9.(t)  No further funds shall be allocated into the State Textbook fund. The Department of Public Instruction, in coordination with the Office of State Budget and Management, shall ensure that the fund is dissolved once all funds are expended.



SECTION 7.9.(u)  Effective July 1, 2025, there is established the Instructional Materials funding allotment within the State Public School Fund. The State Board of Education shall establish the purposes for which the funds within the Instructional Materials funding allotment may be used for the purchase and maintenance of instructional and supplemental materials as identified in Part 3 of Article 8 of Chapter 115C of the General Statutes. Funds allocated to the Instructional Materials funding allotment in fiscal years 2025‑2026, 2026‑2027, and 2027‑2028 shall not revert to the General Fund at the end of the fiscal year but shall remain available until expended.



SECTION 7.9.(v)  This section becomes effective July 1, 2025, and applies beginning with the 2025‑2026 school year.



 



Stabilization OF LOW‑WEALTH ALLOTMENT



SECTION 7.10.  The Department of Public Instruction shall examine the formula for the supplemental funding in low‑wealth counties allotment and develop a new funding model for that allotment. The new model shall prioritize counties receiving more predictable allotments year to year to avoid large differentials between consecutive school years. The model developed pursuant to this section shall allocate no more than the funds allocated for low‑wealth supplemental funding in the 2025‑2026 school year. The Department shall propose technical adjustments for low‑wealth supplemental funding to the State Board of Education for approval before submitting the model to the Fiscal Research Division no later than February 15, 2026. The technical adjustments shall include a list of any laws that would need to be adjusted or repealed to allow for the new funding model to be implemented as well as a comparison of funding received under the old model and the recommended new model, sorted by county.



 



Technical Adjustment to Administrative Licensure Requirements



SECTION 7.11.(a)  G.S. 115C‑270.20(b) reads as rewritten:



(b)      Administrator Licenses. – The State Board shall establish rules for the issuance of the following classes of administrator licenses, including required levels of preparation for each classification:



(1)        Administrator license. – A five‑year renewable license issued to an individual who meets all of the following requirements:



a.         Holds a bachelor's degree.



b.         Has successfully completed an approved administrator preparation program.



c.         Has at least four years of experience as a licensed professional educator.



d.         Has For individuals seeking a principal license, has submitted a portfolio to the State Board for approval that meets criteria adopted by the State Board.



….



SECTION 7.11.(b)  This section is effective when it becomes law and applies to applicants for licensure on or after that date.



 



Various Education Report Changes



SECTION 7.12.(a)  G.S. 115C‑12(25) is recodified as G.S. 115C‑21(a)(10) and reads as rewritten:



(10)    Duty to Report to Joint Legislative Education Oversight Committee. – Upon the request of the Joint Legislative Education Oversight Committee, the State Board Superintendent of Public Instruction shall examine and evaluate issues, programs, policies, and fiscal information, and shall make reports to that Committee. Furthermore, by November 15 March 15 of each year, the State Board Superintendent of Public Instruction shall submit reports to that Committee regarding schools identified as low‑performing, school improvement plans found to significantly improve student performance, personnel actions taken in low‑performing schools, and recommendations for additional legislation to improve student performance and increase local flexibility.



SECTION 7.12.(b)  Subdivision (4) of subsection (d) of G.S. 115C‑81.45 is repealed.



SECTION 7.12.(c)  Subsection (b) of Section 7.17 of S.L. 2018‑5 is repealed.



SECTION 7.12.(d)  Subsection (d) of Section 7.32 of S.L. 2017‑57 is repealed.



SECTION 7.12.(e)  G.S. 115C‑12(48) reads as rewritten:



(48)    Computer Science Reporting. – The State Board of Education shall report annually by November 15 March 15 to the Joint Legislative Education Oversight Committee, the Senate Appropriations Committee on Education/Higher Education, and the House Appropriations Committee on Education on the following data related to computer science participation. For each item, the report shall include (i) statewide data for the current school year, and the four years prior when data is available, to establish trends in computer science instruction and (ii) data for the current school year for each public school unit, disaggregated by school within that unit:



….



SECTION 7.12.(f)  G.S. 115C‑316.2 is repealed.



SECTION 7.12.(g)  G.S. 115C‑316.5(a) reads as rewritten:



(a)      For the purposes of this section, the term school health personnel refers to the same positions listed in G.S. 115C‑316.2(a).school psychologists, school counselors, school nurses, and school social workers.



SECTION 7.12.(h)  G.S. 115C‑299.5 reads as rewritten:



§ 115C‑299.5.  Duty to monitor the state of the teaching profession.teacher attrition and mobility.



…



(b)        State of the Teaching Profession Teacher Attrition and Mobility Report. – The State Board of Education shall monitor and compile an annual report to be submitted by the Department of Public Instruction by December 15 February 15 annually on the state of the attrition and mobility of teachers in the teaching profession in North Carolina that includes data on the decisions of teachers to leave the teaching profession and vacancies in teaching positions as provided in subsections (c) and (e) of this section. The State Board shall adopt standard procedures for each local board of education to use in requesting information required by this report and shall require each local board of education to report the information to the State Board in a standard format adopted by the State Board.



SECTION 7.12.(i)  G.S. 115C‑12(22), as amended by S.L. 2023‑134, reads as rewritten:



(22)    Duty to Monitor the State of the Teaching Attrition and Mobility of Teachers and the State of the School Administration Professions Profession in North Carolina. – The State Board of Education shall monitor and compile an annual report on the state of the teaching attrition and mobility of teachers and the state of the school administration professions profession in North Carolina, as provided in G.S. 115C‑289.2 and G.S. 115C‑299.5.



SECTION 7.12.(j)  G.S. 115C‑289.2(d) reads as rewritten:



(d)      Report Consolidation. – The report required by this section shall be consolidated with the report on the State of the Teaching Profession Teacher Attrition and Mobility Report required by G.S. 115C‑299.5.



SECTION 7.12.(k)  G.S. 115C‑269.50 reads as rewritten:



§ 115C‑269.50.  EPP report cards.



The State Board shall create an annual report card for each EPP that, at a minimum, summarizes the information collected in the annual performance reports, as set forth in G.S. 115C‑269.35(b). The report cards shall provide user‑friendly access to the public, and shall provide the ability to easily compare annual report card information between EPPs, including performance and other data reported by each EPP, as provided in G.S. 115C‑269.35(b). The State Board shall make the report cards available to the public through the State Board's Internet Web site website on an annual basis beginning December 15, 2019, February 15, 2026, and the Department of Public Instruction shall submit the report to the Joint Legislative Education Oversight Committee annually by that date.



SECTION 7.12.(l)  Subsection (b) of Section 8.30 of S.L. 2015‑241, as amended by Section 3.1(b) of S.L. 2019‑165, is repealed.



SECTION 7.12.(m)  G.S. 115C‑450(d) reads as rewritten:



(d)      No later than May 15, 2022, and every six months thereafter, February 15 of each year, the Department of Public Instruction shall report all the following information to the Joint Legislative Education Oversight Committee, the Senate Appropriations Committee on Education/Higher Education, the House Appropriations Committee on Education, and the Fiscal Research Division:



….



SECTION 7.12.(n)  G.S. 115C‑218.42(e) reads as rewritten:



(e)      Reporting. – No later than March August 15 of each year in which funds are awarded under the Program, the Department shall report to the Joint Legislative Education Oversight Committee, the Joint Legislative Transportation Oversight Committee, the Senate Appropriations/Base Budget Committee, the House Committee on Appropriations, and the Fiscal Research Division on the administration of the Program, including at least the following information:



….



SECTION 7.12.(o)  G.S. 115C‑218.110(b) reads as rewritten:



(b)      The State Board of Education shall review and evaluate the educational effectiveness of the charter schools authorized under this Article and the effect of charter schools on the public schools in the local school administrative unit in which the charter schools are located. The Board shall report annually no later than June August 15 to the Joint Legislative Education Oversight Committee on the following:



….



SECTION 7.12.(p)  G.S. 115C‑107.5 reads as rewritten:



§ 115C‑107.5.  Annual reports.



The State Board shall report send a copy of the annual report submitted as part of the State Performance Plan and Annual Performance Report that is submitted to the United States Department of Education and United States Office of Special Education Programs no later than October 15 of each year to the Joint Legislative Education Oversight Committee on the implementation of this Article and the educational performance of children with disabilities. The report may be filed electronically. Each annual report shall include the following information:



(1)        A copy of the following documents that were submitted, received, or made public during the year:



a.         The most recent State performance plan and any amendments to that plan submitted to the Secretary of Education.



b.         Compliance and monitoring reports submitted to the Secretary of Education.



c.         The annual report submitted to the Secretary of Education on the performance of the State under its performance plan.



d.         Any other information required under IDEA to be made available to the public.



(2)        An analysis of the educational performance of children with disabilities in the State and a summary of disputes under Part 1D of this Chapter.



(3)        Development and implementation of any policies related to improving outcomes for elementary and secondary school students with disabilities, including any changes related to the directives set forth in Section 8.30 of S.L. 2015‑241 as follows:



a.         Reforms related to IEP requirements.



b.         Transition services for students with disabilities from elementary to middle school, middle to high school, and high school to postsecondary education, and for employment opportunities and adult living options.



c.         Increased access to Future Ready Core Course of Study for students with disabilities.



d.         Model programs for use by local school administrative units to improve graduation rates and school performance of students with disabilities.



SECTION 7.12.(q)  G.S. 115C‑107.3 reads as rewritten:



§ 115C‑107.3.  Child find.



(a)        The Board shall require an annual census of all children with disabilities residing in the State, subdivided for identified and suspected children with disabilities, to be taken in each school year. Suspected children are those in the formal process of being evaluated or identified as children with disabilities. The census shall be conducted annually and shall be completed by October 15, submitted to the Governor and General Assembly and made available to the public by January 15 annually. The census submitted to the General Assembly may be a copy of any information or any report submitted to the federal government as part of compliance with the Individuals with Disabilities Education Act pursuant to 20 U.S.C. § 1418.



(b)        In taking the census, the Board requires the cooperation, participation, and assistance of all local educational agencies. Therefore, each local educational agency shall cooperate and participate with and assist the Board in conducting the census.



(c)        The census shall include the number of children identified and suspected with disabilities, their age, the nature of their disability, their county or city of residence, their local school administrative unit residence, whether they are being provided special educational or related services and if so by what local educational agency, the identity of each local educational agency having children with disabilities in its care, custody, management, jurisdiction, control, or programs, the number of children with disabilities being served by each local educational agency, and any other information or data that the Board requires. The census shall be of children with disabilities between the ages three through 21 but is not required to include children with disabilities that have graduated from high school.



 



Changes to literacy instruction



SECTION 7.13.(a)  G.S. 115C‑83.6 reads as rewritten:



§ 115C‑83.6.  Facilitating early grade reading proficiency.



(a)        Kindergarten, first, second, and third Kindergarten through fifth grade students shall be assessed with valid, reliable, formative, and diagnostic reading assessments made available to local school administrative units by the State Board of Education pursuant to G.S. 115C‑174.11(a). Difficulty with reading development identified through administration of formative and diagnostic assessments shall be addressed with literacy interventions outlined in the student's Individual Reading Plan. Parents or guardians of first and second grade students offered a reading camp as a literacy intervention shall be encouraged to enroll their student in the reading camp provided by the local school administrative unit. Parents or guardians of a student identified as demonstrating reading comprehension below grade level shall make the final decision regarding a student's reading camp attendance.



(a1)      Kindergarten through third fifth grade reading assessments shall yield data that can be used with the Education Value‑Added Assessment System (EVAAS) to analyze student data to identify root causes for difficulty with reading development and to determine actions to address them.



(a2)      The Department of Public Instruction shall provide for EVAAS analysis all formative and diagnostic assessment data collected pursuant to this section for kindergarten through third fifth grade. The Department shall use a uniform template for all data collected, and the template shall be used each time data is provided. The template shall include clear designations for each data component reported.



(b)        Formative and diagnostic assessments and resultant literacy interventions shall address oral language, phonological and phonemic awareness, phonics, vocabulary, fluency, and comprehension using developmentally appropriate practices. These assessments may be administered by computer or other electronic device.



(c)        Local school administrative units are encouraged to partner with community organizations, businesses, and other groups to provide volunteers, mentors, or tutors to assist with the provision of literacy interventions that enhance reading development and proficiency.



SECTION 7.13.(b)  G.S. 115C‑83.6B(a) reads as rewritten:



(a)      An Individual Reading Plan (IRP) shall be developed for any student in kindergarten through third fifth grade demonstrating difficulty with reading development based on the results of either (i) the first diagnostic or formative assessment of the school year or (ii) the first diagnostic or formative assessment of the second semester of the school year. The IRP shall be continually adjusted based on multiple data sources as prescribed by the Department of Public Instruction, indicating that the student is not progressing toward grade‑level standards in one or more major reading areas. Based on the most recently collected data, the IRP shall include the following information, specific to the identified student:



(1)        The specific reading skill deficiencies identified by assessment data.



(2)        Goals and benchmarks for growth.



(3)        The means by which progress will be monitored and evaluated.



(4)        The specific additional literacy interventions the student will receive.



(5)        The Science of Reading‑based instructional programming the teacher will implement.



(6)        Any additional services the teacher deems appropriate to accelerate the student's reading skill and development.



SECTION 7.13.(c)  G.S. 115C‑83.9(a) reads as rewritten:



(a)      Parents or guardians shall be notified in writing, and in a timely manner, that the student shall be retained, unless he or she is exempt from mandatory retention for good cause, if the student is not demonstrating reading proficiency by the end of third grade. Parents or guardians shall receive this notice when a kindergarten, first, second, or third grade student (i) is demonstrating difficulty with reading development; or (ii) is not reading at grade level. Additionally, parents or guardians shall receive notice when a fourth or fifth grade student is demonstrating difficulty with reading development or is not reading on grade level as determined by assessments given pursuant to G.S. 115C‑83.6.



SECTION 7.13.(d)  G.S. 115C‑83.10(b) reads as rewritten:



(b)      Each local board of education shall report annually in writing to the State Board of Education by September 1 of each year the following information on the prior school year:



(1)        A description of all literacy interventions provided to students who have been retained under G.S. 115C‑83.7(a).



(2)        The number of first and second grade students attending a reading camp offered by the local board.



(3)        The license area or areas, years of licensed teaching experience, grade level assignment, and any other specific subject‑area assignments of each teacher providing instruction at a reading camp.



(4)        The number and percentage of teachers providing instruction at a reading camp who were paid a reading performance bonus during the school year immediately preceding the reading camp and the grade level on which the bonus was based.



(5)        The number of kindergarten through third fifth grade students with an Individual Reading Plan.



SECTION 7.13.(e)  G.S. 115C‑174.11(a) reads as rewritten:



(a)      Assessment Instruments for Kindergarten, First, Second, and Third Kindergarten Through Fifth Grades. – The State Board of Education shall develop, adopt, and provide to the local school administrative units developmentally appropriate individualized assessment instruments aligned with the standard course of study and Part 1A of Article 8 of this Chapter for the kindergarten, first, second, and third grades. kindergarten through fifth grade. Local school administrative units shall use these assessment instruments provided to them by the State Board for kindergarten, first, second, and third kindergarten through fifth grade students to assess progress, diagnose difficulties, and inform instruction and remediation needs. Local school administrative units shall not use standardized tests for summative assessment of kindergarten, first, and second grade students except as required as a condition of receiving federal grants.



SECTION 7.13.(f)  The Department of Public Instruction shall use funds appropriated for this purpose in this act to contract with Lexia Learning Systems, LLC, to provide Lexia Aspire Professional Learning to all English Language Arts and Exceptional Children teachers who teach students in grades six through eight in schools that are identified as low‑performing schools based on data from the 2024‑2025 school year. Teachers that complete training pursuant to this subsection shall receive stipends of up to two hundred dollars ($200.00) for the 2025‑2026 school year.



SECTION 7.13.(g)  The State Board of Education shall develop literacy standards for grades six through eight to align with the professional learning provided pursuant to subsection (f) of this section.



 



Fiscal Responsibility and K‑12 Tech Planning



SECTION 7.14.(a)  Part 3A of Article 8 of Chapter 115C of the General Statutes is amended by adding new sections to read:



§ 115C‑102.10.  Technology costs considerations.



The State Board of Education shall adopt rules requiring all public school units to evaluate the following when acquiring technology, computer hardware, and software:



(1)        The long‑term cost of ownership, including costs of repairing the technology, computer hardware, or software.



(2)        Any flexibility for innovation during the life of the technology, computer hardware, or software.



(3)        Any anticipated resale or salvage value at the end of the target life cycle for the technology, computer hardware, or software based on the average resale or salvage value of similar technology, computer hardware, or software as a percentage of the initial cost of purchase.



§ 115C‑102.11  Break/fix rate reporting requirement.



(a)        Definitions. – The following definitions apply in this section:



(1)        Break/fix rate. – The percentage obtained by dividing the number of school technology devices reported as malfunctioning or needing repair due to physical damage, hardware failure, or other breakage incidents prior to the stated life cycle period, not covered by insurance or a policy plan period, by the total number of school technology devices in operation during that period.



(2)        School technology device. – Any electronic or computerized equipment provided for educational purposes in a public school unit, including computers, tablets, interactive whiteboards, and similar devices or anything considered a digital device for purposes of the digital learning dashboard pursuant to G.S. 115C‑102.9.



(b)        Each governing body of a public school unit shall submit a report on the following information to the State Board of Education by August 15 annually:



(1)        The break/fix rate of the school technology devices in the public school unit for the previous school year.



(2)        The total number of school technology devices currently in operation in the public school unit.



(3)        The total number of school technology devices in the public school unit requiring repair that (i) underwent repair or (ii) were no longer in service during the previous school year.



(4)        The total amount of funds spent to repair or replace school technology devices during the previous school year.



(c)        The State Board of Education shall report to the Joint Legislative Education Oversight Committee by November 15 annually on the break/fix rate of school technology devices across all public school units based on the reports submitted by the governing bodies in accordance with subsection (b) of this section. This report shall include a summary of the data reported by each governing body and recommendations to reduce break/fix rates in the future.



SECTION 7.14.(b)  The first reports from governing bodies of public school units required by G.S. 115C‑102.11(b), as enacted by this section, shall be submitted no later than August 15, 2026, based on data collected during the 2025‑2026 school year. The first report from the State Board of Education required by G.S. 115C‑102.11(c), as enacted by this section, shall be submitted no later than November 15, 2026.



SECTION 7.14.(c)  G.S. 115C‑12 is amended by adding a new subdivision to read:



(50)    To Require Evaluation of Technology Costs. – The State Board shall adopt rules governing public school units evaluating technology costs in accordance with G.S. 115C‑102.10.



SECTION 7.14.(d)  G.S. 115C‑47 is amended by adding new subdivisions to read:



(70)    To Evaluate Technology Costs. – A local board of education shall adopt a policy requiring the evaluation of technology costs considerations adopted by the State Board of Education pursuant to G.S. 115C‑102.10.



(71)      To Report on Break/Fix Rate. – A local board of education shall report annually to the State Board of Education on the break/fix rate of school technology devices in accordance with G.S. 115C‑102.11.



SECTION 7.14.(e)  G.S. 115C‑150.12C is amended by adding new subdivisions to read:



(37)    Evaluate technology costs. – The board of trustees shall adopt a policy requiring the evaluation of technology costs considerations adopted by the State Board of Education pursuant to G.S. 115C‑102.10.



(38)      Report on break/fix rate. – The board of trustees shall report annually to the State Board of Education on the break/fix rate of school technology devices used in the school in accordance with G.S. 115C‑102.11.



SECTION 7.14.(f)  Part 2 of Article 14A of Chapter 115C of the General Statutes is amended by adding a new section to read:



§ 115C‑218.33.  School technology.



(a)        A charter school shall adopt a policy requiring the evaluation of technology costs considerations adopted by the State Board of Education pursuant to G.S. 115C‑102.10.



(b)        A charter school shall report annually to the State Board of Education on the break/fix rate of school technology devices used in the school in accordance with G.S. 115C‑102.11.



SECTION 7.14.(g)  G.S. 115C‑238.66 is amended by adding new subdivisions to read:



(18a)  The board of directors shall adopt a policy requiring the evaluation of technology costs considerations adopted by the State Board of Education pursuant to G.S. 115C‑102.10.



(18b)    The board of directors shall report annually to the State Board of Education on the break/fix rate of technology used in the school in accordance with G.S. 115C‑102.11.



SECTION 7.14.(h)  G.S. 116‑239.8(b) is amended by adding new subdivisions to read:



(21a)  Evaluate technology costs. – The chancellor shall adopt a policy requiring the evaluation of technology costs considerations adopted by the State Board of Education pursuant to G.S. 115C‑102.10.



(21b)    Report on break/fix rate. – The chancellor shall report annually to the State Board of Education on the break/fix rate of technology used in the school in accordance with G.S. 115C‑120.11.



SECTION 7.14.(i)  This section is effective when it becomes law and applies beginning with the 2025‑2026 academic year.



 



Automatic Enrollment in Advanced English Language Arts Courses



SECTION 7.15.(a)  G.S. 115C‑81.36 reads as rewritten:



§ 115C‑81.36.  Advanced courses in mathematics.mathematics and English Language Arts.



(a)        When practicable, local boards of education shall offer advanced learning opportunities in mathematics in grades three through five, and advanced courses in mathematics in all grades six and higher. For the purposes of this section, advanced learning opportunities are those services and curricular modifications in mathematics and English Language Arts for academically or intellectually gifted students approved as part of the local plan, as required by G.S. 115C‑150.7.G.S. 115C‑150.7, and advanced courses are advanced courses in mathematics and English Language Arts.



(a1)      When advanced learning opportunities are offered in mathematics in grades three through five, any student scoring at the highest level on the corresponding end‑of‑grade test shall, for the next school year, be provided advanced learning opportunities in mathematics approved for that student's grade level. No student who qualifies under this subsection shall be removed from the advanced learning opportunity provided to the student unless a parent or guardian of the student provides written consent for the student to be excluded or removed after being adequately informed that the student's placement was determined by the student's achievement on the previous end‑of‑grade test.



(b)        When advanced courses are offered in mathematics in grades six and higher, any student scoring at the highest level on the corresponding end‑of‑grade or end‑of‑course test for the mathematics course in which the student was most recently enrolled shall be enrolled in the advanced course for the next mathematics course in which the student is enrolled. A student in seventh grade scoring at the highest level on the seventh grade mathematics end‑of‑grade test shall be enrolled in a high school level mathematics course in eighth grade. Local boards of education may provide supplemental content enrichment, which may include the administration of diagnostic assessments, to students enrolled in a high school level mathematics course. No student who qualifies under this subsection shall be removed from the advanced or high school mathematics course in which the student is enrolled unless a parent or guardian of the student provides written consent for the student to be excluded or removed from that course after being adequately informed that the student's placement was determined by the student's achievement on the previous end‑of‑grade or end‑of‑course test.



(b1)      When a high school mathematics course is offered in eighth grade, a student in seventh grade scoring at the highest level on the seventh grade mathematics end‑of‑grade test shall be enrolled in a high school level mathematics course in eighth grade. Local boards of education may provide supplemental content enrichment, which may include the administration of diagnostic assessments, to students enrolled in a high school level mathematics course.



(c)        By December 15, 2020, December 15, 2025, and annually thereafter, the Department of Public Instruction shall submit a report to the Joint Legislative Education Oversight Committee containing data collected for the current school year on the number and demographics number, demographics, and socioeconomic status of students who were eligible for advanced mathematics courses under this section, including high school level mathematics courses in eighth grade, and of those students, the number and demographics number, demographics, and socioeconomic status of those who were placed in advanced mathematics courses and were not placed in advanced mathematics courses. The report shall include information on the type and format of advanced mathematics courses provided and shall also include any feedback provided by local boards of education on the implementation of this section.



(d)       The Department of Public Instruction shall provide guidance to local boards of education on how to best develop programming and courses to ensure all impacted students receive rigorous, academically appropriate instruction in mathematics.mathematics and English Language Arts.



(e)        No student who qualifies for advanced learning opportunities or advanced courses under this section shall be removed from the advanced learning opportunity or advanced course provided to the student unless a parent or guardian of the student provides written consent for the student to be excluded or removed after being adequately informed that the student's placement was determined by the student's achievement on the previous end‑of‑grade or end‑of‑course test. Local boards of education may provide supplemental content enrichment, which may include the administration of diagnostic assessments, to students enrolled in advanced courses.



SECTION 7.15.(b)  This section is effective when it becomes law and applies beginning with the 2025‑2026 school year.



 



Highly Effective Limited License Teachers



SECTION 7.16.(a)  G.S. 115C‑270.15 reads as rewritten:



§ 115C‑270.15.  Examination requirements.



…



(e)        Conversion to Continuing Professional License. – The Except as provided in subsection (f) of this section, the State Board shall not convert an IPL or RL IPL, RL, or limited license to a continuing professional license for a teacher who has not fulfilled the examination requirements of this section.



(f)        Waiver of Examination Requirements for Certain Individuals with Limited Licenses. – The State Board shall convert a limited license to a continuing professional license for a teacher who has available growth data under the Education Value‑Added Assessment System (EVAAS) and has a positive average growth score for two of the three most recent years.



SECTION 7.16.(b)  This section is effective when it becomes law and applies to limited licenses expiring on or after that date.



 



COMPETENCY‑BASED HIGH SCHOOL/HEALTHCARE AND HIGH‑TECH PATHWAYS PROGRAM



SECTION 7.17.(a)  Program Established; Purpose. – There is established the Competency‑Based High School/Healthcare and High‑Tech Pathways Program (Program). The purpose of the Program is to create pathways that will utilize competency‑based education (CBE). Pathways will result in obtaining either an associate degree or an industry recognized credential, certification, or licensure based on the student's goal of employment or enrollment. Students will decide their college or career track at the end of their junior year with an initial emphasis on healthcare preparation.



SECTION 7.17.(b)  Participants. – Mooresville Graded School District (MGSD) shall partner with Mitchell Community College (MCC) to implement the Program.



SECTION 7.17.(c)  Program Time Line. – MGSD, in collaboration with MCC, shall contract with an organization with demonstrated expertise in designing and implementing learner‑centered, modular, and competency‑based high school programs that align with emerging and high‑tech career pathways. The organization shall have experience in co‑designing stackable credentials with local education agencies and higher education partners and a documented track record of developing digital infrastructure that supports student‑paced progression, interdisciplinary learning, and real‑world skill acquisition. This expert partner shall assist in developing a framework for the Program, including course design, sequencing, credentialing structure, and other elements necessary for personalized student progression during the 2025‑2026 school year. Students will have the opportunity to participate in a pathway provided by the Program by the 2027‑2028 school year at the latest.



SECTION 7.17.(d)  Program Flexibilities. – Notwithstanding any provision of law to the contrary, the following flexibilities shall be available to Program participants:



(1)        MGSD may offer Credit by Demonstrated Mastery assessments and CTE Proof of Learning assessments outside of existing State testing windows.



(2)        MCC may enroll MGSD students in community college courses prior to their eleventh grade year without the student meeting the requirements for ninth and tenth grade students pursuant to subdivision (4) of G.S. 115D‑20.



(3)        Students participating in the Program shall have access to all community college courses at MCC, regardless of pathway selection.



(4)        MGSD may replace any high school graduation credit requirement, except those outlined in this subdivision, with either community college courses offered by MCC or locally developed CBE courses that are consistent with the student's pathway. MGSD shall not replace any graduation credit requirements in the following subject areas:



a.         English.



b.         Mathematics.



c.         Science.



d.         Social Studies.



(5)        MGSD may operate any high school in the local school administrative unit consistent with the flexibilities of a school operating under a restart model pursuant to G.S. 115C‑105.37B(a)(2).



SECTION 7.17.(e)  Selection of Third‑Party Vendor. – MGSD shall select a third‑party vendor (Vendor) that is an educational support provider with a nationally recognized, research‑based instructional and leadership framework, including a High Reliability School model, a taxonomy of educational objectives aligned to classroom strategies, and a system for implementing personalized competency‑based education. The provider shall have published extensively in peer‑reviewed and practitioner literature, have an established track record of working directly with K‑12 schools and districts across multiple states, and offer professional development services, implementation support, and instructional resources developed and led by a founding education researcher with over four decades of influence in curriculum, instruction, and assessment.



SECTION 7.17.(f)  MGSD Partnership with Vendor. – MGSD shall partner with the Vendor selected pursuant to subsection (e) of this section to develop standards‑aligned proficiency scales for all content areas in grades nine through 12 to ensure educators in the participating schools have the tools necessary to successfully transition to CBE approaches. The Vendor shall provide professional development and coaching to the schools in MGSD to ensure educators can engage in learning about CBE approaches, including implementation of the proficiency scales developed by MGSD.



SECTION 7.17.(g)  Funding. – Of the funds appropriated to the Department of Public Instruction allocated to MGSD pursuant to this section, MGSD shall use the funds for the following purposes:



(1)        To contract with experts in CBE and designing stackable credentials pursuant to subsection (c) of this section.



(2)        To hire one additional staff member at MGSD to oversee implementation of the Program.



(3)        To partner with a Vendor pursuant to subsection (f) of this section.



 



Lighthouse Math Project



SECTION 7.18.(a)  Project Established; Purpose. – There is established the Lighthouse Math Project (Project). The purpose of the Project is to increase the percentage of high school students who are (i) eligible to complete college level mathematics upon graduation from high school and (ii) able to complete college level math either through dual enrollment while in high school or within the first year of college enrollment.



SECTION 7.18.(b)  Project Participants. – Wake Technical Community College (Wake Tech) shall partner with Wake County Public School System (WCPSS) for high school students at East Wake High School and Knightdale High School to be eligible to participate in the Project at the Wake Tech East campus of Wake Tech. Wake Tech and WCPSS shall partner with SparkNC to align the Project participants' ongoing efforts at the Wake Tech East campus with the design and implementation of the Project.



SECTION 7.18.(c)  Project Commitments. – WCPSS, in collaboration with Wake Tech, shall contract with Khan Academy, Inc. (Khan), for use of the artificial intelligence student tutoring program, Khanmigo. Students enrolling at participating high schools shall have access to Khanmigo from the time of enrollment in the high school and continuing through their attendance at Wake Tech if the student chooses to enroll at Wake Tech East. Wake Tech shall collaborate with Khan to do the following:



(1)        Develop and deliver at least one Khanmigo‑centered gateway college math course to be offered to high school students at participating high schools to be completed as a college level math course. This course shall also be available to students who graduate from participating high schools and enroll in the courses at Wake Tech East.



(2)        Develop a Khanmigo‑centered developmental math course sequence that will be provided by Wake Tech faculty to students from participating high schools in one of the following formats:



a.         As part of a Career and College Promise Career Ready Pathway.



b.         As supplement to a Career and College Promise Pathway.



c.         As a summer bridge program available to students prior to or subsequent to their junior and senior years of high school.



d.         As a community college course during the first semester of enrollment at Wake Tech.



SECTION 7.18.(d)  Modular Math Course. – As part of the Project, Khan, in consultation with Wake Tech and WCPSS, shall work to develop a self‑paced, competency‑based modular math course with appropriate student diagnostics and student assessments based on the college readiness math competencies provided as part of the Project. It is the intent that students successfully demonstrating college readiness math competencies will be eligible to enroll in college level math courses.



SECTION 7.18.(e)  Funding; DPI. – Of the funds appropriated from the General Fund to the Department of Public Instruction, the sum of up to five hundred thousand dollars ($500,000) in nonrecurring funds for the 2025‑2026 fiscal year shall be used to contract with Khan for licenses for the Khanmigo application and to create the course developed pursuant to subdivision (1) of subsection (c) of this section. Funds appropriated for the purposes laid out in this section shall not revert but shall remain available to accomplish the purposes of this section until the end of the 2026‑2027 fiscal year.



SECTION 7.18.(f)  Funding; NCCCS. – Of the funds appropriated to the Community Colleges System Office for the 2025‑2026 fiscal year, the sum of one million dollars ($1,000,000) in nonrecurring funds shall be used to establish time‑limited positions at Wake Tech. Two positions shall be assigned to work in each participating high school to assist in the implementation of the courses offered by the Project. Funds appropriated for the purposes laid out in this section shall not revert but shall remain available to accomplish the purposes of this section until the end of the 2028‑2029 fiscal year.



 



Competency‑Based Education and HIgh school REdesign Strategic Network



SECTION 7.19.  Mooresville Graded School District, Mitchell Community College, Wake Technical Community College, Wake County Public School System, Fayetteville Technical Community College, Wilkes Community College, and SparkNC shall collaborate to create a Competency‑Based Education and High School Redesign Strategic Network (Network). The president of SparkNC, or the president's designee, shall serve as the chair of the Network. The chair shall coordinate the operations of the Network and provide administrative and technical support for the Network to the extent such support is necessary. The Network shall provide a means for each entity to share what it has learned and developed regarding CBE and high school redesign. The goals of the Network shall be to advance the goals of developing a CBE approach to education across the State.



 



North Carolina Competency‑Based Education Innovation Grant Program



SECTION 7.20.(a)  Program Established; Purpose. – There is established the North Carolina Competency‑Based Education Innovation Grant and Network Program (Program). The purpose of the program is to provide funding and support to schools and districts to support the transition to competency‑based education (CBE) models that focus on mastery of learning rather than instructional time. The grant aims to promote innovative instructional practices, flexible assessment models, and systemic shifts to ensure all students progress based on demonstrated proficiency.



SECTION 7.20.(b)  Program Objectives. – The objectives of the Program are as follows:



(1)        Redesign learning pathways. – Support schools and districts in developing personalized, CBE models that allow students to progress at their own pace.



(2)        Assessment innovation. – Utilize formative and performance‑based assessments that measure student mastery of skills and knowledge, including the use of AI learning tools.



(3)        Educator capacity building. – Provide common professional development for educators on instructional strategies and assessment practices aligned with transitioning to CBE.



(4)        Develop strategies for statewide scaling and best practices. – Develop and share resources, implementation strategies, and lessons learned to expand CBE across North Carolina.



SECTION 7.20.(c)  Phase One. – The first phase of the Program shall begin with the 2025‑2026 school year and continue until the conclusion of the 2028‑2029 school year. Public school units shall submit applications and complete any planning or organizational duties during the 2025‑2026 school year with implementation of CBE in participating schools beginning with the 2026‑2027 school year.



SECTION 7.20.(d)  Application. – The Department of Public Instruction shall create an application for the Program and make the application available to all public school units no later than 60 days after this act becomes law. Public school units shall submit their applications to the Department no later than 60 days after the application becomes available. The Department shall select 10 schools to participate in the Program no later than 60 days after the close of the application period. When selecting schools to participate in the Program, the Department shall prioritize schools that show a strong commitment to implementing CBE and innovation in assessment. The Department shall develop criteria to determine which schools are most ready to transition to CBE. The application shall include at least the following:



(1)        A comprehensive plan outlining the school's vision for competency‑based education.



(2)        A description of instructional and assessment shifts to be implemented.



(3)        A budget for use of grant funds and a sustainability plan to continue utilizing CBE after the conclusion of Phase One.



(4)        Commitments from public school units leadership and stakeholders.



SECTION 7.20.(e)  Grant Funds; Use; Training. – Grant awards shall be in the amount of three hundred thirty thousand dollars ($330,000) to each participating school. Participating schools shall use the sum of ninety‑five thousand dollars ($95,000) each school year to receive training on the implementation of CBE in the school. The remaining grant funds shall be used for costs associated with the transition to CBE, including travel costs and CBE resources. Grant funds shall remain available until the end of the 2028‑2029 fiscal year.



SECTION 7.20.(f)  Selection of Third‑Party Vendor. – The Department shall select a third‑party vendor (Vendor) that is an educational support provider with a nationally recognized, research‑based instructional and leadership framework, including a High Reliability School model, a taxonomy of educational objectives aligned to classroom strategies, and a system for implementing personalized competency‑based education. The provider must have published extensively in peer‑reviewed and practitioner literature, have an established track record of working directly with K‑12 schools and districts across multiple states, and offer professional development services, implementation support, and instructional resources developed and led by a founding education researcher with over four decades of influence in curriculum, instruction, and assessment.



SECTION 7.20.(g)  Department Partnership with Vendor. – The Department shall partner with the Vendor selected pursuant to subsection (f) of this section to develop publicly available, standards‑aligned proficiency scales for all content areas and grade levels to ensure educators in the participating schools have the tools necessary to successfully transition to CBE approaches. The Vendor shall provide annual professional development events throughout the regions of the State to ensure educators can engage in learning about CBE approaches, including implementation of the proficiency scales developed by the Department.



SECTION 7.20.(h)  Department Duties. – The Department of Public Instruction shall do the following as part of the Program:



(1)        Develop, in collaboration with the Vendor, a CBE Network to support the long‑term transition to CBE. The CBE Network shall do the following:



a.         Provide strategic guidance and policy recommendations for scaling CBE statewide.



b.         Facilitate collaboration among grant recipients, educators, policymakers, and CBE industrial leaders.



c.         Develop a long‑term roadmap for CBE implementation statewide.



d.         Offer professional learning communities and shared online resources to support ongoing innovation and capacity building.



e.         Develop methods of measuring proficiency for all courses offered as part of the standard course of study in kindergarten through grade 12, with support from the Vendor.



f.          Disseminate developed proficiency measures to all public school units and post standards developed to align with the proficiency measures online on a publicly accessible website.



g.         Conduct research and evaluation to inform best practices and continuous improvement in participating schools.



(2)        Provide support and technical assistance, professional learning opportunities, and access to the CBE network for all grant recipients.



SECTION 7.20.(i)  Reporting; Participants. – Each participating school shall submit a quarterly progress report to the Department detailing implementation of CBE in the school. The Department shall establish the due dates and mechanism for the submission of the progress reports. Progress shall include available student learning outcome data, including evidence of progress toward content mastery.



SECTION 7.20.(j)  Reporting; Department. – The Department of Public Instruction shall submit a final report on the outcomes of Phase One of the Program to the Joint Legislative Education Oversight Committee by December 1, 2029. The report shall include the following:



(1)        A summary of student outcomes reported by participating schools.



(2)        Any challenges experienced by participating schools or the Department with implementation of the Program.



(3)        Recommendations for scaling the Program statewide.



(4)        Any other information the Department deems relevant.



(5)        Any information requested by the Committee.



 



AI ACADEMIC SUPPORT PROGRAM



SECTION 7.21.  Chapter 115C of the General Statutes is amended by adding a new Article to read:



Article 42.



Academic Support Programs.



§ 115C‑650.  Establish AI Academic Support Program.



(a)        Purpose; Program. – There is established the AI Academic Support Program (Program) to allow public school units to contract with Khan Academy, Inc., (Khan Academy) for use of the academic support service Khanmigo, in grades six through 12. Khanmigo is an application that uses artificial intelligence to support teachers with lesson plan development and to support students with lesson comprehension.



(b)        Funding. – Funds shall be allocated to each public school unit on the basis of average daily membership (ADM) in grades six through 12 in the public school unit for the purposes set out in this section.



(c)        Funding Use. – Public school units that utilize funds pursuant to this section shall use all funds to contract with Khan Academy for use of the Khanmigo service, any associated professional development, and the rostering programs required pursuant to subsection (e) of this section.



(d)       Contract Term. – Public school units entering into contracts with Khan Academy shall contract for a term of one year. At the end of each school year, each public school unit shall evaluate the use of Khanmigo services in the public school unit prior to contracting with Khan Academy for the subsequent school year. The evaluation shall include all of the information required to be reported on by the Department of Public Instruction in subdivisions (2) through (7) of subsection (h) of this section. Public school units shall submit their evaluations to the Department of Public Instruction by July 15 of each year that funds are used pursuant to this section.



(e)        Class Rostering for Khanmigo. – All public school units that contract with Khan Academy pursuant to this section shall use a secure, cloud‑based, single sign‑on, and class rostering platform to manage access to digital instructional resources and student information systems and to facilitate automated data integration between educational applications and school district systems. Class rostering products used pursuant to this section must be approved by the Department.



(f)        Juvenile Justice. – The Department shall contract with Khan for 500 Khanmigo licenses and training for use in schools operated by the Division of Juvenile Justice of the Department of Public Safety. The Department of Public Instruction shall provide technical support to the Division of Juvenile Justice for the use of Khanmigo. The Division of Juvenile Justice shall comply with evaluation requirements pursuant to subsection (d) of this section.



(g)        Study. – The Office of Learning Research at the North Carolina Collaboratory (OLR) shall design and conduct a study to measure the effectiveness of using Khanmigo, including any impact on student performance and growth. As part of the study, the Department of Public Instruction shall aggregate and report to OLR on the evaluations submitted by public school units and the Division of Juvenile Justice pursuant to subsections (d) and (f) of this section. OLR shall collaborate with Khan Academy to aggregate data on student performance by teacher and by subgroup, to the extent allowed by law. OLR shall provide the results of this study to the Joint Legislative Education Oversight Committee no later than April 1, 2028.



(h)        Report. – No later than February 15 of each year in which funds are made available for the Program, the Department of Public Instruction shall report to the Joint Legislative Education Oversight Committee at least the following information:



(1)        The number public school units that contracted with Khan Academy pursuant to this article.



(2)        The number of students using the Khanmigo application.



(3)        The average number of minutes and interactions students had with the Khanmigo application weekly.



(4)        The number of teachers using the application.



(5)        The average number of minutes and interactions teachers had with the Khanmigo application weekly.



(6)        Any identified impact on student outcomes.



(7)        Any identified impact on teacher performance.



(8)        The number of moderation flags generated by the application.



 



AUTHORIZE NEW COOPERATIVE INNOVATIVE HIGH SCHOOLS and codify supplemental funding



SECTION 7.22.(a)  With the funds appropriated to the Department of Public Instruction by this act for cooperative innovative high schools, the Department shall allocate to local school administrative units the sum of six hundred thirty‑five thousand dollars ($635,000) in recurring funds for the 2025‑2026 fiscal year in amounts consistent with those set forth in G.S. 115C‑238.54A, as enacted by this section, as supplemental funding for the following cooperative innovative high schools for the 2025‑2026 school year:



(1)        Hawthorne Academy of Health Sciences.



(2)        Martin Innovative Early College of Health Sciences.



(3)        Moore County Cooperative Innovative High School.



SECTION 7.22.(b)  Beginning with the 2025‑2026 school year and for subsequent school years thereafter, notwithstanding G.S. 115C‑238.51A(c), G.S. 115C‑238.54, and any other provision of law to the contrary, Hawthorne Academy of Health Sciences, Martin Innovative Early College of Health Sciences, and Moore County Cooperative Innovative High School shall be permitted to operate in accordance with G.S. 115C‑238.53 and G.S. 115C‑238.54 as cooperative innovative high schools approved under G.S. 115C‑238.51A(c) and shall be subject to the evaluation requirements of G.S. 115C‑238.55.



SECTION 7.22.(c)  Part 9 of Article 16 of Chapter 115C of the General Statutes is amended by adding a new section to read:



§ 115C‑238.54A.  Cooperative innovative high schools – supplemental allotment funding based on county development tier designation.



(a)        Allocation of Funding. – The Department shall allocate cooperative innovative high school supplemental allotment funds to local school administrative units with a cooperative innovative high school approved pursuant to G.S. 115C‑238.51A(c) based on developmental tier area, as defined in G.S. 143B‑437.08, as follows:



(1)        Local school administrative units located in a development tier one area shall be allocated funding as follows:



a.         The sum of two hundred seventy‑five thousand dollars ($275,000) in recurring funds for each cooperative innovative high school in the unit.



b.         For the Northeast Regional School of Biotechnology and Agriscience, the Department shall allocate the sum of three hundred ten thousand dollars ($310,000) in recurring funds from the regional school supplemental allotment for the school for each fiscal year.



(2)        Local school administrative units located in a development tier two area shall be allocated the sum of two hundred thousand dollars ($200,000) in recurring funds for each cooperative innovative high school in the unit.



(3)        Local school administrative units located in a development tier three area shall be allocated the sum of one hundred eighty thousand dollars ($180,000) in recurring funds for each cooperative innovative high school in the unit.



(b)        Applicability of Funds. – The allotment of funds to local school administrative units pursuant to subsection (a) of this section shall include cooperative innovative high schools approved pursuant to G.S. 115C‑238.51A(c) operated by a local school administrative unit regardless of not receiving allotments in a prior fiscal year. Funds shall not be allocated to local school administrative units for cooperative innovative high schools approved by the State Board pursuant to G.S. 115C‑238.51A(b).



 



REPEAL CODING AND MOBILE APP DEVELOPMENT GRANT PROGRAM



SECTION 7.23.  Section 7.23 of S.L. 2017‑57 is repealed.



 



maintain coverage of COPAYs FOR REDUCED‑PRICE school MEALS



SECTION 7.24.(a)  G.S. 115C‑264 is amended by adding a new subsection to read:



(a1)    A local board of education that is operating a school nutrition program shall provide school lunches, and if provided, breakfasts, to students at no cost to the student for students in all grade levels that qualify for reduced‑price meals under the federal National School Lunch Program or School Breakfast Program. If funds from alternate sources are insufficient to provide school meals at no costs to students for students that qualify for reduced‑price meals, the Department of Public Instruction may use funds appropriated to the State Aid for Public Schools Fund for this purpose.



SECTION 7.24.(b)  Section 7.58 of S.L. 2023‑134 is repealed.



 



CHARTER SCHOOLS REVIEW BOARD AMENDMENTS



SECTION 7.25.(a)  G.S. 115C‑218 reads as rewritten:



§ 115C‑218.  Purpose of charter schools; role of State Board of Education; establishment of North Carolina Charter Schools Review Board and North Carolina Office of Charter Schools.



…



(a1)      State Board of Education. – The State Board of Education shall have the following duties regarding charter schools:



(1)        Rulemaking. – To establish adopt all rules for the operation and approval of charter schools. Any rule or policy adopted by the State Board regarding charter schools shall first be recommended approved by the Charter Schools Review Board.



(2)        Funding. – To allocate funds to charter schools.



(3)        Appeals. – To hear appeals from decisions of the Charter Schools Review Board under G.S. 115C‑218.9.



(4)        Accountability. – To ensure accountability from charter schools for school finances and student performance.



(5)        Review of financial assistance. – The State Board shall assign the Review Board to conduct any hearings pursuant to 20 U.S.C. § 1231b‑2, including making findings and recommendations regarding those hearings.



(b)        North Carolina Charter Schools Review Board. –



…



(10)      Powers and duties. – The Review Board shall have the following duties:



a.         To make recommendations to the State Board of Education on the adoption of propose, recommend, and approve rules and policies regarding all aspects of charter school operation, including time lines, processes, standards, and criteria for acceptance and approval of applications, monitoring of charter schools, and grounds for revocation of charters.



…



e.         To conduct hearings and make findings and recommendations pursuant to subdivision (a1)(5) of this section.



f.          To contract for and employ legal counsel, including private counsel, to advise, represent, and provide litigation services to the Review Board, without need to obtain permission or approval pursuant to G.S. 114‑2.3 or G.S. 147‑17.



…



(c)        North Carolina Office of Charter Schools. –



…



(2)        Executive Director. – The Executive Director shall report to and serve at the pleasure of the Superintendent of Public Instruction Review Board at a salary established by the Superintendent Review Board within the funds appropriated for this purpose. The duties of the Executive Director shall include presenting the recommendations and decisions of the Review Board at meetings of the State Board.



….



SECTION 7.25.(b)  G.S. 115C‑218.15(c) reads as rewritten:



(c)      A charter school shall operate under the written charter signed by the State Superintendent and the applicant. The terms of the written charter shall be approved by the Review Board. A charter school is not required to enter into any other contract. The charter shall incorporate the information provided in the application, as modified during the charter approval process, and any terms and conditions imposed on the charter school by the Review Board, or if the approval is granted through an appeal pursuant to G.S. 115C‑218.9, any conditions imposed by the State Board of Education. No other terms may be imposed on the charter school as a condition for receipt of local funds.



SECTION 7.25.(c)  G.S. 115C‑218.85 is amended by adding a new subsection to read:



(d)      Notwithstanding G.S. 116‑11(10a) or any other provision of law to the contrary, a charter school shall not be required to list class rank on a student's official transcript or record.



SECTION 7.25.(d)  G.S. 115C‑218.90(a) is amended by adding a new subdivision to read:



(7)      A charter school may develop and use any evaluation for conducting evaluation of teachers provided that it includes standards and criteria similar to those used in the North Carolina Professional Teaching Standards and North Carolina Teacher Evaluation Process, or such other evaluation standard and process required to be used by local school administrative units.



SECTION 7.25.(e)  G.S. 115C‑218.94 is amended by adding a new subsection to read:



(c)      The Review Board shall require charter schools that are identified as low‑performing or continually low‑performing to prepare and report on plans to improve the performance of the school. The requirements of G.S. 115C‑105.27 shall not apply to charter schools.



SECTION 7.25.(f)  G.S. 115C‑218.105 reads as rewritten:



§ 115C‑218.105.  State and local funds for a charter school.



…



(a2)      The State Board shall withhold or reduce distribution of funds to a charter school if any of the following applies:



(1)        The change in funding is due to an annual adjustment based on enrollment or is a general adjustment to allocations that is not specific to the charter or actions of that charter school.



(2)        The Review Board notifies the State Board that the charter school has materially violated a term of its charter, has violated a State statute or federal law, or has had its charter terminated or nonrenewed.



(3)        The Superintendent of Public Instruction Review Board notifies the State Board that the charter school has failed to meet generally accepted standards of fiscal management or has violated a State or federal requirement for receipt of funds.



…



(c2)      The Superintendent of Public Instruction Review Board shall, in consultation with charter schools and local school administrative units, create a standardized enrollment verification and transfer request document that each charter school shall use to request the per pupil share of the local current expense fund from the local school administrative units. Charter schools shall only be required to list the name, age, grade, address, date of charter enrollment, date of charter withdrawal, district of residence, and student identification number of each student as provided to the charter school by the student's parent or guardian in the enrollment verification and transfer request document that the charter school submits to the local school administrative units. A charter school, in its discretion, may take further steps to confirm the student's residence in a particular local school administrative unit.



(c3)      The Superintendent of Public Instruction Review Board shall, in consultation with charter schools and local school administrative units, create a standardized procedure that local school administrative units shall use when transferring the per pupil share of the local current expense fund to charter schools. The standardized procedure for transfer of the per pupil share of the local current expense fund shall require, to the extent practicable, that the local school administrative units make the transfers by electronic transfer.



….



SECTION 7.25.(g)  G.S. 115C‑218.123 is amended by adding a new subsection to read:



(c)      If a school is operating under a charter that allows for a remote academy as part of the charter, and the school enrolls or intends to enroll 250 or more students in the remote academy, the school may request that the Review Board grant the remote academy portion of the school a separate charter by submitting the information listed under subsection (a) of this section with the request. Requests submitted pursuant to this section shall be reviewed through an expedited process to be established by the Review Board. The Review Board shall not require a planning year for remote academies granted a charter pursuant to this subsection.



SECTION 7.25.(h)  G.S. 115C‑218.125 reads as rewritten:



§ 115C‑218.125.  Evaluation.



(a)        The State Board of Education shall evaluate the success of remote charter academies approved under this Part. Success shall be measured by school performance scores and grades, retention rates, attendance rates, and, for grades nine through 12, high school completion and dropout rates. The Board shall report by November 15 of each year to the Joint Legislative Education Oversight Committee on the evaluation of these academies and on any recommended statutory changes.



(b)        If a school is operating under a charter that includes in‑person instruction and a remote charter academy, the remote charter academy shall receive a separate school performance grade and be treated as a separate school for the purposes of assessing the performance of the remote charter academy pursuant to G.S. 115C‑12(9)c1., 115C‑83.15, 115C‑218.94, and 115C‑218.95.



SECTION 7.25.(i)  This section is effective when it becomes law and applies beginning with the 2025‑2026 school year.



 



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