NC lawmakers send 'mini budget' and DOGE-style plan to Stein

North Carolina lawmakers gave final approval Wednesday to a spending plan that would allow for continued operations at some state institutions while legislative leaders continue to debate over a full state spending plan. The bill also included a plan to create a division that would examine state government operations with an eye toward cuts.

House lawmakers voted 91 to 23 on Wednesday to send the legislation to Gov. Josh Stein. Lawmakers reached a deal on the spending plan this week. The state Senate approved it Tuesday with a vote of 47 to 2. Stein can approve it, veto it or let it become law without his signature.

The bill is intended to fund the more basic functions of state government that are needed since the new fiscal year began earlier this month without a new budget.

Public schools, colleges and universities are funded largely based on their enrollment numbers, and addressing that was one of the main reasons behind the new mini budget deal. Without its updated numbers, any growing schools would be forced to kick off the new school year with last year’s smaller, outdated budget — while the state would likewise find itself sending too much money to shrinking schools.

The UNC Board of Governors voted last week to shift some funds around between shrinking versus growing universities, but leaders said they were waiting on more formal action like this from the legislature.

The mini budget will also fully fund the state pension plan and pump an additional $100 million into the State Health Plan. The State Health Plan is facing a $500 million shortfall and plans to raise premiums on members next year.

The vote on exactly how much to raise the premiums is slated for Aug. 15, and Health Plan leaders had been hoping for that $100 million from the legislature, to help keep the premium hikes relatively low. The premiums won’t be the same for all state employees, a drastic shift from years past. Instead, state employees who make less money will now also pay less for health insurance than their more highly paid colleagues.

The new spending bill doesn't contain most of the large projects proposed in either the House or Senate versions of budget proposals that passed those respective chambers earlier this year, nor does it contain tax cuts or raises for teachers and other state workers — issues that have deeply divided Republican leaders in the House and Senate. The Senate wants to give small raises in order to afford large tax cuts, while the House wants to do bigger raises and cut taxes by some, but not as much as the Senate wants.

The legislature took most of the past month off. The legislature plans to adjourn again and then continue meeting just once a month for the rest of the year.

DOGE-stye division

As part of the budget, lawmakers also approved policy instructing the state auditor, Republican Dave Boliek, to find state government jobs that could be cut — an undertaking similar to that conducted by the Department of Government Efficiency, or DOGE, in the federal government.

What had been introduced as the so-called DAVE Act — which creates the Division of Accountability, Value, and Efficiency — was rolled into the mini budget. The bill includes $6 million to fund auditor activities included in the DAVE Act, which has been a priority for Senate Leader Phil Berger. House Republicans agreed to include the DAVE Act in the mini budget as part of broader spending negotiations.

Republican legislators have moved multiple times to expand the auditor’s powers since last year, when Boliek became the first Republican to win the auditor’s race since 2004.

Legislators last year gave Boliek’s office control over the state Board of Elections. The governor has been in charge of elections in North Carolina for more than a century, and multiple other GOP-backed efforts to take that power away from former Gov. Roy Cooper were either struck down as unconstitutional in court or shot down at the ballot box by voters. Stein is challenging the latest law in court, as well. That case is ongoing.

Democratic critics alleged that the bill was created by Republicans to expand Boliek’s powers not in the name of government efficiency — but to expand the GOP’s oversight of state government.

“Our team is prepared to take a data-driven approach in its evaluation of North Carolina’s government,” Boliek said in a statement Wednesday. “If cuts to government need to be made, or agencies need to be reorganized or eliminated, we’re not going to shy away from making those recommendations.

He added: “I am fully on board with this initiative, and I share the General Assembly’s commitment to better government. Ultimately, the goal is to make sure the people of North Carolina — who fund the government — are served in an efficient and effective way.”