SL 2025-89 — Mini-budget filling the gap: DAVE Act, Boom Supersonic anchor, and Medicaid rebase
An Act to Implement Various Budgetary Adjustments and to Make Other Changes in the Budget Operations of the State
Primary bill · HB 125
Primary sponsors · Lambeth, Paré, K. Hall, White (all R)
The first of four mini-budgets standing in for an unenacted 2025-27 biennium budget. Anchors most of the General Fund. Creates the State Auditor's Division of Accountability, Value & Efficiency (DAVE Act). Locks in the $118.1M FY25-26 first installment of the Greensboro airplane manufacturer megaproject.
Quick context on the bill
SL 2025-89 (HB 125) is the first of a four-act series — followed by SL 2025-91, 92, and 97 — that together substitute for an unenacted 2025-27 biennium budget. The General Assembly did not pass a comprehensive Current Operations Appropriations Act for the 2025-2027 biennium; instead it appropriated piecemeal through this act and three mini-budgets that came after. SL 2025-89 carries the bulk of the General Fund: 14,492 line items totaling $62.35B in signed appropriations across the biennium, spread across 64 agencies. Beyond the appropriations math, two substantive policy moves sit inside this act — the establishment of the State Auditor's Division of Accountability, Value and Efficiency (the "DAVE Act") and the first $118.1M installment of a $450M six-year commitment for a transformative aviation manufacturing project at Piedmont Triad International Airport.
SL 2025-89 — Impacted industries and likely lobbying principals
Part I — Appropriations, Disaster Funding
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 1.1 | Base budget appropriations for 2025-27 biennium tied to Governor's Recommended Base Budget. | All state-funded sectors | Impacted industries All state-funded sectors Likely lobbying principals |
| 1.3 | Transfers $142M from Stabilization and Inflation Reserve to NCDA&CS for the Agricultural Disaster Crop Loss Program (Helene-related verifiable farm-infrastructure losses). | Agriculture; specialty crops; row crops; farm infrastructure contractors | Impacted industries Agriculture; specialty crops; row crops; farm infrastructure contractors Likely lobbying principals |
| 1.4 | Restricts use of Section 1.3 funds: requires recipient pursuit of insurance and federal aid, bars Governor from using these funds for budget adjustments under G.S. 143C-6-4. | Same as 1.3 | Impacted industries Same as 1.3 Likely lobbying principals |
Part II-A — Education
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2A.1 | Education Lottery Fund allocations for 2025-27 biennium: $385.9M Noninstructional Support; $78.3M Pre-K; $100M Public School Building Capital Fund; $258.3M Needs-Based Public School Capital Fund; $50M Public School Repair & Renovation; $182.2M (FY25-26) and $186.0M (FY26-27) for School Transportation. Reduces Longleaf Commitment CC Grant by $12.4M, Wartime Veterans Scholarship by $11.1M, Need-Based UNC Scholarship by $75M. Total: $1.083B (FY25-26), $1.087B (FY26-27). | K-12 public education; community colleges; UNC System; school construction; school transportation; veterans services | Impacted industries K-12 public education; community colleges; UNC System; school construction; school transportation; veterans services Likely lobbying principals |
| 2A.2 | Indian Gaming Education Revenue Fund allocations: $10M textbooks; classroom materials $15.5M (FY25-26) and $3.5M (FY26-27). Reduces DPI Classroom Materials allotment by $2.5M recurring and $12M nonrecurring. | K-12; tribal gaming revenue downstream beneficiaries | Impacted industries K-12; tribal gaming revenue downstream beneficiaries Likely lobbying principals |
| 2A.5A | $10M FY25-26 nonrecurring to Wilson Community College for biologics training center operation. | Community colleges; biotech workforce training | Impacted industries Community colleges; biotech workforce training Likely lobbying principals |
| 2A.6 | Net reduction to DPI of ~$9.1M recurring per year. Eliminates funding for: Small Specialty High Schools ($1.8M); Learn and Earn virtual cooperative innovative high schools ($1M); Plasma Games STEM software contract ($1.8M); Beginnings nonprofit for parents of children who are deaf or hard of hearing ($1.5M). | K-12 STEM; ed-tech vendors; deaf/HoH education; alternative education models | Impacted industries K-12 STEM; ed-tech vendors; deaf/HoH education; alternative education models Likely lobbying principals |
| 2A.7 | $104.2M recurring each year to DPI for enrollment-driven technical adjustments (salaries, special populations, low-wealth supplemental funding). | K-12; low-wealth counties | Impacted industries K-12; low-wealth counties Likely lobbying principals |
| 2A.8 | Codifies state-funded coverage of copays for reduced-price school meals into G.S. 115C-264. | K-12; school nutrition; child hunger advocacy | Impacted industries K-12; school nutrition; child hunger advocacy Likely lobbying principals |
| 2A.10A | $9.4M recurring each year to DPI for Uniform Education Reporting System / new student information system transition. | K-12 ed-tech; student information system vendors | Impacted industries K-12 ed-tech; student information system vendors Likely lobbying principals |
| 2A.10B | Redirects $25M Helene-related school rebuild funds in Yancey County from FEMA-conditional rebuilds to broader construction/upgrade flexibility. | K-12 capital; Helene disaster recovery; Yancey County | Impacted industries K-12 capital; Helene disaster recovery; Yancey County Likely lobbying principals |
| 2A.11 | Reduces UNC funding by $3.6M each year: eliminates Longleaf Commitment CC Grant ($125K — no remaining eligible students); cuts Graduate Tuition Waiver ($3.5M recurring) for nonresident graduate students. | UNC System; graduate research | Impacted industries UNC System; graduate research Likely lobbying principals |
| 2A.12 | $9.5M recurring each year for NC Promise Tuition Plan enrollment growth at ECSU, Fayetteville State, UNC-Pembroke, Western Carolina. | UNC System (specifically the four NC Promise campuses) | Impacted industries UNC System (specifically the four NC Promise campuses) Likely lobbying principals |
| 2A.13 | $2.87M recurring each year + $516K nonrecurring for operation/maintenance of completed capital projects at NC State, UNC-Chapel Hill, NC School of Science and Math. | UNC System | Impacted industries UNC System Likely lobbying principals |
Part II-B — Health and Human Services
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2B.1 | Reduces NC Loan Repayment Program by $2M recurring each year. | Healthcare workforce; rural health; medical/dental/behavioral providers in shortage areas | Impacted industries Healthcare workforce; rural health; medical/dental/behavioral providers in shortage areas Likely lobbying principals |
| 2B.2 | Reduces Child Care Subsidy GF appropriation by $8M recurring each year, offset by TANF receipts. | Child care providers; low-income working families | Impacted industries Child care providers; low-income working families Likely lobbying principals |
| 2B.3 | Repeals Mental Health and Substance Use Task Force Reserve Fund; transfers ~$41.8M nonrecurring balance into DMH/DD/SUS single-stream; reduces single-stream by ~$10M recurring; restructures Child and Family Well-Being receipts. | LME/MCO behavioral health system; DMH/DD/SUS; child case management | Impacted industries LME/MCO behavioral health system; DMH/DD/SUS; child case management Likely lobbying principals |
| 2B.4 | Reduces three-way (inpatient psych) bed contract funding by $15.7M recurring — described as "savings attributable to NC Health Works." | Community hospitals with psych beds; LME/MCOs; behavioral health | Impacted industries Community hospitals with psych beds; LME/MCOs; behavioral health Likely lobbying principals |
| 2B.5 | Reduces DMH/DD/SUS single-stream funding by $18.6M recurring. Requires LME/MCOs to maintain 2024-25 service utilization levels. | LME/MCO behavioral health system | Impacted industries LME/MCO behavioral health system Likely lobbying principals |
| 2B.6 | Cuts State-County Special Assistance Program GF appropriation by $8.6M (FY25-26) and $2.25M (FY26-27) nonrecurring; departmental receipts also reduced. | Adult care homes; assisted living; county DSS | Impacted industries Adult care homes; assisted living; county DSS Likely lobbying principals |
| 2B.7 | Uses ~$20M of Talc Settlement (J&J) funds across biennium to offset Division of Public Health appropriations. | Public health programs; AG's office (settlement administration) | Impacted industries Public health programs; AG's office (settlement administration) Likely lobbying principals |
| 2B.10 | $600M recurring each year for Medicaid rebase + managed care administration, including Children and Families Specialty Plan launch (Dec 2025). | Medicaid PHPs; behavioral health providers; child welfare/foster care | Impacted industries Medicaid PHPs; behavioral health providers; child welfare/foster care Likely lobbying principals |
| 2B.11 | Exempts qualified urban ambulatory surgical facilities (counties >125,000 pop, licensed pre-11/21/2025) from 4% self-pay/Medicaid charity care requirement. | Ambulatory surgical facilities (urban); hospitals competing on outpatient surgery | Impacted industries Ambulatory surgical facilities (urban); hospitals competing on outpatient surgery Likely lobbying principals |
| 2B.12 | Restructures Health Advancement Receipts Special Fund quarterly transfer mechanics under HASP — gross premiums tax offset routing changes. Reduces DHB appropriation by $22.3M recurring each year. | All Medicaid stakeholders; insurance regulatory; hospitals via HASP | Impacted industries All Medicaid stakeholders; insurance regulatory; hospitals via HASP Likely lobbying principals |
| 2B.13 | Requires UNC Hospitals at Chapel Hill to deposit $31.4M each year + state-owned psych hospitals to deposit IGT-style returns. | Public hospitals; state-operated psychiatric facilities | Impacted industries Public hospitals; state-operated psychiatric facilities Likely lobbying principals |
Part II-C — Agriculture and Natural and Economic Resources
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2C.1 | Establishes Sunday Opening State Historic Site Pilot Program at 13 named sites: Bentonville Battlefield, Brunswick Town/Fort Anderson, Charlotte Hawkins Brown Museum, Fort Fisher, Aycock Birthplace, Historic Bath, Historic Edenton, Historic Halifax, NC State Capitol, Reed Gold Mine, Roanoke Island Festival Park, Somerset Place, Thomas Day Site. $114K each fiscal year. | State historic sites; heritage tourism; site-adjacent hospitality | Impacted industries State historic sites; heritage tourism; site-adjacent hospitality Likely lobbying principals |
| 2C.2 | $118.1M FY25-26 to Commerce for "qualifying transformative project" at Piedmont Triad International Airport. Requires $4.5B private investment, 14,000 eligible positions at $89,340 average wage. Allocation: $15M Authority land acquisition (up to 150 acres); $45M Authority site analysis/engineering/grading/site prep/access roads/taxiway; $7.9M DOT roadwork; $5M City of Greensboro water/sewer; $10.2M Authority hub renovation + FAA offsets; $35M Authority manufacturing/R&D facility construction. Signaled out-year appropriations: $133.9M (FY26-27) + $198M across FY27-31 — total $450M state commitment over six years. | Aerospace; supersonic aviation; airport infrastructure; commercial construction; engineering/site-prep contractors; water/sewer utilities; aviation manufacturing supply chain | Impacted industries Aerospace; supersonic aviation; airport infrastructure; commercial construction; engineering/site-prep contractors; water/sewer utilities; aviation manufacturing supply chain Likely lobbying principals |
Part II-D — Justice and Public Safety
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2D.1 | $10M FY25-26 nonrecurring to AOC Indigent Defense Services for the Private Assigned Counsel (PAC) Fund shortfall. | Court-appointed defense bar; indigent defense | Impacted industries Court-appointed defense bar; indigent defense Likely lobbying principals |
| 2D.2 | $5.7M (NR) + $421.5K (recurring) for opening McLeansville Readiness Center (Jan 2026); $400K nonrecurring for North Wilkesboro Readiness Center. | NC National Guard; military construction; Guilford and Wilkes county economies | Impacted industries NC National Guard; military construction; Guilford and Wilkes county economies Likely lobbying principals |
Part II-E — General Government
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2E.2 | The DAVE Act. Establishes State Auditor's Division of Accountability, Value, and Efficiency to assess agency efficiency and recommend dissolutions/position eliminations. All agencies must report vacant-position data by Oct 1, 2025. AI-assisted analysis explicitly authorized. Reports to General Assembly by Dec 31, 2025. $6M recurring each year for 45 positions. Sunsets Dec 31, 2028. | Every executive-branch state agency; agency contractors; state employee unions | Impacted industries Every executive-branch state agency; agency contractors; state employee unions Likely lobbying principals |
| 2E.3 | Creates 7 exempt positions at the State Board of Elections (general counsel, HR director, public information manager, legislative affairs manager, internal auditor, etc.) at $1.19M recurring per year. Amends G.S. 126-5 to add SBE Executive Director to exempt-position authority alongside Council of State officers. | State Board of Elections; election administration | Impacted industries State Board of Elections; election administration Likely lobbying principals |
| 2E.5 | $15M nonrecurring FY25-26 from IT Reserve to SBE for State Election Information Management System (SEIMS) upgrade + campaign finance software upgrade. SBE issues RFP. | Election information system vendors | Impacted industries Election information system vendors Likely lobbying principals |
Part II-F — Transportation
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2F.1 | Highway Fund: $1.2M recurring FY25-26 to create 40 Driver License Examiner FTEs; $2.99M recurring FY26-27 for 21 more. | DMV operations; driver license throughput | Impacted industries DMV operations; driver license throughput Likely lobbying principals |
| 2F.2 | Highway Fund: $1.8M recurring + $11.5M nonrecurring (FY25-26) + $2.75M recurring (FY26-27) for new DMV offices in Brunswick County, Cabarrus County, Fuquay-Varina (Wake), Garland (Sampson). 24 + 12 new FTEs. | DMV operations; county economic development | Impacted industries DMV operations; county economic development Likely lobbying principals |
Part II-G — Miscellaneous Reductions and Adjustments
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 2G.1 | Vacant position elimination targets: DPI ($1.85M each year), DEQ ($2.26M FY25-26 / $2.93M FY26-27), DIT ($1.4M each year). Each agency must report eliminations by Dec 1. | State workforce; specifically DPI, DEQ, DIT | Impacted industries State workforce; specifically DPI, DEQ, DIT Likely lobbying principals |
Part III — Salary and Benefits
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 3.1 | $197.5M recurring FY25-26 for state employee benefits, plus $8.5M from Highway Fund for DOT. Allocated across DPI ($115M), UNC ($29M), Community Colleges ($14.7M), DAC ($14M), AOC ($7.2M), and dozens of smaller agency lines. | All state-funded workforce | Impacted industries All state-funded workforce Likely lobbying principals |
| 3.3 | Authorizes step increases, performance bonuses, and salary schedule movements during continuing-budget-authority period beginning July 1, 2025. Keeps prior teacher-bonus and supplemental-funds authorities alive notwithstanding 2023-25 fiscal limitation. | State employees; teachers; principals | Impacted industries State employees; teachers; principals Likely lobbying principals |
| 3.6 | Sets employer retirement contribution rates for FY25-26: 17.14% (teachers/state); 17.14% (state LEOs, also +5% NC 401k); 6.84% (ORPs); 37.73% (CJRS); 18.26% (LRS). Sets State Health Plan max annual employer contribution at $8,500/covered employee. Increases State contribution to Firefighters' & Rescue Squad Workers' Pension Fund by $350K. | State retirement systems; public-sector health insurance | Impacted industries State retirement systems; public-sector health insurance Likely lobbying principals |
Part IV — Information Technology
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 4.1 | Adds State Board of Elections and State Highway Patrol to the list of entities exempt from Article 15 (DIT consolidation). Extends State Bureau of Investigation / Division of Emergency Management DIT exemption pilot through June 30, 2027. | State IT consolidation; specific exempt agencies; private IT vendors holding their contracts | Impacted industries State IT consolidation; specific exempt agencies; private IT vendors holding their contracts Likely lobbying principals |
| 4.2 | Expands Broadband Pole Replacement Program to include underground placement of broadband facilities as eligible reimbursement. Adds utility-owned poles to "pole" definition. Adds "previously served but disaster-damaged" to "unserved area" definition. | Broadband ISPs; municipal utilities; rural broadband; Helene recovery in WNC | Impacted industries Broadband ISPs; municipal utilities; rural broadband; Helene recovery in WNC Likely lobbying principals |
| 4.3 | Repeals existing GREAT fixed-wireless/satellite program statutes (G.S. 143B-1373.2 and 1374). Authorizes DIT to use those funds for satellite-internet installation-material grants prioritized to Helene-affected counties. Authorizes emergency funding to providers for rebuilding Helene-damaged broadband infrastructure (up to $50M from Broadband Make Ready Accelerator). | Broadband ISPs (especially Helene-affected); satellite internet; fixed wireless providers | Impacted industries Broadband ISPs (especially Helene-affected); satellite internet; fixed wireless providers Likely lobbying principals |
| 4.4 | Amends BEAD Program definitions (low-cost broadband service option ties to NTIA guidance rather than NC-specific spec); extends timing rules. | Broadband ISPs eligible for BEAD subgrants | Impacted industries Broadband ISPs eligible for BEAD subgrants Likely lobbying principals |
Part V — Capital
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 5.1 | $823.6M FY25-26 nonrecurring from State Capital and Infrastructure Fund to OSBM, allocated across UNC System capital projects and other state capital priorities. (SL 2025-92 later amended this upward to $888.6M; UNC-Pembroke Regional Emergency Response Center named at $5M.) | UNC System capital; state-owned facilities; construction contractors | Impacted industries UNC System capital; state-owned facilities; construction contractors Likely lobbying principals |
Part VI — General Government
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 6.1 | $300K recurring to Office of State Fire Marshal (Department of Insurance) for three administrative positions. | Fire services regulation; insurance regulation | Impacted industries Fire services regulation; insurance regulation Likely lobbying principals |
| 6.2 | $20.85M FY25-26 + $850K FY26-27 nonrecurring from IT Reserve to OSBM for purposes specified in that section. | State IT infrastructure; OSBM operations | Impacted industries State IT infrastructure; OSBM operations Likely lobbying principals |
Part VII — Information Technology (separate from Part IV)
| Section | Subject | Impacted industries | Likely lobbying principals |
|---|---|---|---|
| 7.1 | Companion to Part IV broadband sections — additional federal broadband fund allocations and MCNC fiber grant administration. | Same as Part IV 4.2-4.4 | Impacted industries Same as Part IV 4.2-4.4 Likely lobbying principals |
Methodology
The industries and principals in this chart are Lapel’s editorial readings of who is likely lobbying which provisions, drawn from NC Secretary of State lobbyist-principal registration data and the public bill history of the underlying legislation. These are not direct attestations from the principals named, and the chart does not claim that every party listed worked the section.