RURAL Care Act.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 2
HOUSE BILL 1090
Committee Substitute Favorable 5/12/26

Short Title: RURAL Care Act. (Public)
Sponsors:
Referred to:
April 30, 2026
*H1090-v-2*
A BILL TO BE ENTITLED 1
AN ACT TO ENACT THE REVITALIZING, UPLIFT ING REGIONS & ACCESS LOCAL 2
(RURAL) CARE ACT TO PROVIDE FOR THE CREA TION OF A RURAL 3
HEALTHCARE INFRASTRU CTURE FUND AND A RUR AL HEALTHCARE 4
INFRASTRUCTURE PROGR AM TO BE ADMINISTERE D BY THE NEWLY 5
CREATED NORTH CAROLI NA RURAL HEALTHCARE INFRASTRUCTURE 6
COUNCIL; TO DIRECT T HE NORTH CAROLINA RU RAL HEALTHCARE 7
INFRASTRUCTURE COUNCIL TO DEVELOP A PLAN FOR THE ESTABLISHMENT 8
AND ADMINISTRATION O F THE RURAL HEALTHCA RE INFRASTRUCTURE 9
PROGRAM; AND TO REPE AL TH E RURAL HEALTH CARE STABILIZATION 10
PROGRAM. 11
The General Assembly of North Carolina enacts: 12
13
PART I. RURAL HEALTHCARE INFRASTRUCTURE FUND 14
SECTION 1.1.(a) Chapter 131E of the General Statutes is amended by adding a new 15
Article to read: 16
"Article 4A. 17
"Rural Healthcare Infrastructure Fund." 18
SECTION 1.1.(b) G.S. 131A-32 is recodified as G.S. 131E-74 in Article 4A of 19
Chapter 131E of the General Statutes, as enacted by subsection (a) of this section, and reads as 20
rewritten: 21
"§ 131E-74. The Rural Health Care Stabilization Healthcare Infrastructure Fund. 22
(a) Legislative Intent. – The General Assembly recognizes the need to establish and 23
maintain a sufficient funding source to address the ongoing capital and healthcare infrastructure 24
needs of the rural areas of the State. The General Assembly further recognizes the need to protect 25
the State 's substantial improvements in existing health care facilities while providing a stable 26
funding source to pay for new facilities to meet the needs of a growing rural population. 27
(b) Creation and Source of Funds. – The Rural Health Care Stabilization Healthcare 28
Infrastructure Fund is created as a nonreverting special fund in the Office of State Budget and 29
Management. Department of Health and Human Services to provide financial assistance in the 30
form of grants and loans at below market interest rates with structured repayment terms to support 31
the construction, renovation, or modernization of healthcare facilities located in rural areas of the 32
State. The Fund shall operate as a revolving fund consisting of funds appropriated to, or otherwise 33
received by, the Rural Health Care Stabilization Healthcare Infrastructure Program and all funds 34
received as repayment of the principal of or interest on a loan made from the Fund. The North 35
Carolina Rural Healthcare Infrastructure Council shall administer the Fund. The State Treasurer 36
General Assembly Of North Carolina Session 2025
Page 2 House Bill 1090-Second Edition
is the custodian of the Fund and shall invest its assets in accordance with G.S. 147-69.2 and 1
G.S. 147-69.3. Moneys in the Fund shall only be used for loans made pursuant to this Article. 2
(c) Use of Funds. – Monies in the Fund shall first be used to meet the debt service 3
obligations supported by the General Fund. In addition to meeting the debt service obligatio ns 4
supported by the General Fund, the North Carolina Rural Healthcare Infrastructure Council may 5
allocate money from the Fund to provide financial assistance for the following purposes: 6
(1) New capital projects for facilities licensed under this Chapter or Chapter 122C 7
of the General Statutes that are located in rural areas of the State. 8
(2) Repair and renovation projects for existing facilities licensed under this 9
Chapter or Chapter 122C of the General Statutes that are located in rural areas 10
of the State. 11
(3) Other healthcare infrastructure projects located in rural areas of the State 12
determined by the North Carolina Rural Healthcare Infrastructure Council to 13
be consistent with the intent of the General Assembly, as specified in 14
subsection (a) of this section. 15
(4) Administrative costs incurred by the North Carolina Rural Healthcare 16
Infrastructure Council for administering the Fund , provided that such costs 17
shall not exceed one hundred thousand dollars ($100,000) in any fiscal year. 18
(d) Unexpended Funds. – Funds appropriated for a project that are unspent and 19
unencumbered upon completion of the project shall revert to the Fund. For the purposes of this 20
subsection, a project includes any allocation from the Fund for a purpose specified in subsection 21
(c) of this section. 22
(e) Report. – Annually on March 1, the North Carolina Rural Healthcare Infrastructure 23
Council shall report to the Joint Legislative Oversight Committee on Health and Human Services 24
and the Fiscal Research Division on the use of funds allocated from the Fund. The report shall 25
include at least all of the following information for the preceding fiscal year: 26
(1) Amounts credited to the Fund. 27
(2) Amounts expended from the Fund and the purposes of the expenditures , 28
including, at a minimum: 29
a. A description of each project funded and for each project, the location 30
and the type and amount of financial assistance provided. 31
b. A detailed list of administrative costs incurred by the North Carolina 32
Rural Healthcare Infrastructure Council for administering the Rural 33
Healthcare Infrastructure Fund. 34
(3) Proposed expenditures of the monies in the Fund for the current and upcoming 35
fiscal years. 36
(4) Any other information the North Carolina Rural Healthcare Infrastructure 37
Council deems relevant to the financial sustainability of the Fund. 38
"§§ 131E-74.1 through 131E-74.25. Reserved for future codification purposes." 39
SECTION 1.1.(c) The North Carolina Rural Healthcare Infrastructure Council shall 40
not begin awarding financial assistance from the Rural Healthcare Infrastructure Fund created by 41
G.S. 131E-74, as enacted by subsection (b) of this section, until the plan for a Rural Healthcare 42
Infrastructure Program developed by the North Carolina Rural Healthcare Infrastructure Council 43
pursuant to Part II of this act has been approved by an act of the General Assembly. The North 44
Carolina Rural Healthcare Infrastructure Council shall not be required to make the report required 45
by G.S. 131E-74(e), as enacted by subsection (b) of this section, until March 1 after the plan for 46
a Rural Healthcare Infrastructure Program developed by the North Carolina Rural Healthcare 47
Infrastructure Council pursuant to Part II of this act has been approved by an act of the General 48
Assembly. 49
SECTION 1.2. Section 1.1(c) of this Part is effective when it becomes law. 50
51
General Assembly Of North Carolina Session 2025
House Bill 1090-Second Edition Page 3
PART II. PLAN FOR RURAL HEALTHCARE INFRASTRUCTURE PROGRAM 1
SECTION 2.1.(a) By July 1, 2027, the North Carolina Rural Healthcare 2
Infrastructure Council, in consultation with the Office of Rural Health of the Department of 3
Health and Human Services, shall develop and submit to the Joint Legislative Oversight 4
Committee on Health and Human Services and the Fiscal Research Division a plan for the North 5
Carolina Rural Healthcare Infrastructure Council to establish and administer a Rural Healthcare 6
Infrastructure Program (the program) funded by the Rural Healthcare Infrastructure Fund created 7
by G.S. 131E-74, as enacted by Section 1.1(b) of this act (the Fund). The purpose of the program 8
is to award financial assistance from the Fund in the form of grants and loans at below market 9
interest rates with structured repayment terms to support the construction, renovation, or 10
modernization of healthcare infrastructure located in rural areas of the State. The plan sh all 11
include recommendations for at least all of the following: 12
(1) An application process, including factors to be considered in approving or 13
denying applications for financial assistance from the Fund. 14
(2) A description of the entities and projects eligib le to receive financial 15
assistance from the Fund. 16
(3) A process and criteria for evaluating the financial viability and sustainability 17
of healthcare facilities seeking financial assistance from the Fund. 18
(4) A process for administering and monitoring funds awarded from the Rural 19
Healthcare Infrastructure Fund. 20
(5) A process for monitoring compliance with contractual obligations and 21
performance indicators established for recipients of financial assistance. 22
(6) A long -term plan for financial sustainability of the Fund, including the 23
identification of all potential State and federal sources of funding. 24
(7) Any legislative changes necessary to implement the Rural Healthcare 25
Infrastructure Program. 26
(8) The amount of State appropriations needed to establish and ad minister the 27
Rural Healthcare Infrastructure Program. 28
(9) An assessment of the state of rural healthcare infrastructure in the State, 29
including ongoing needs assessment, progress toward improving access to 30
healthcare in rural areas of the State, and financ ial sustainability of existing 31
and planned infrastructure projects. 32
(10) Any other information the North Carolina Rural Healthcare Infrastructure 33
Council deems relevant to implementing the program and administering the 34
Fund. 35
SECTION 2.1.(b) The North Carolina Rural Healthcare Infrastructure Council shall 36
not implement the plan developed pursuant to subsection (a) of this section without an act by the 37
General Assembly. 38
SECTION 2.2. This Part is effective when it becomes law. 39
40
PART III. CREATION O F THE NORT H CAROLINA RURAL HEA LTHCARE 41
INFRASTRUCTURE COUNCIL 42
SECTION 3.1.(a) G.S. 131E-191.1 is recodified as G.S. 131E-74.2. 43
SECTION 3.1.(b) G.S. 131E-74.2, as enacted by subsection (a) of this section, reads 44
as rewritten: 45
"§ 131E-74.2. Lobbyists prohibited from serving on the Creation of the North Carolina 46
State Health Coordinating Council.Rural Healthcare Infrastructure Council; 47
powers and duties; composition; qualifications of members ; terms; re moval; 48
vacancies; quorum; per diem. 49
(a) Powers and Duties. – The North Carolina Rural Healthcare Infrastructure Council has 50
the following powers and duties: 51
General Assembly Of North Carolina Session 2025
Page 4 House Bill 1090-Second Edition
(1) To work with the D epartment to prepare an annual Rural Healthcare 1
Infrastructure Plan. 2
(2) To administer the Rural Healthcare Infrastructure Fund created by 3
G.S. 131E-74. 4
(b) Composition. – The North Carolina Rural Healthcare Infrastructure Council shall 5
consist of the following 17 members: 6
(1) Nine members appointed by the Governor as follows: 7
a. One at-large member. 8
b. One member with experience in health economics. 9
c. One member with experience in medical education. 10
d. One member with experience in public health. 11
e. One member with experience operating a small business employing 12
fewer than 50 employees on a full-time basis. 13
f. One member with experience operating a large business employing 14
more than 50 employees on a full-time basis. 15
g. One member licensed to practice medicine in this State under Chapter 16
90 of the General Statutes. 17
h. One member who is a registered nurse licensed to practice nursing in 18
this State under Chapter 90 of the General Statutes. 19
i. One member with experience in data analytics. 20
(2) Eight members appointed by the General Assembly in accordance with 21
G.S. 120-121 as follows: 22
a. One at-large member appointed on the recommendation of the Speaker 23
of the House of Representatives. 24
b. One member with experience in hospital management appointed on 25
the recommendation of the Speaker of the House of Representatives. 26
c. One member with experience in home health care appointed on the 27
recommendation of the Speaker of the House of Representatives. 28
d. One member representing health insurers appointed on the 29
recommendation of the Speaker of the House of Representatives. 30
e. One at -large member appointed on the recommendation of the 31
President Pro Tempore of the Senate. 32
f. One member with experience in nursing home management appointed 33
on the recommendation of the President Pro Tempore of the Senate. 34
g. One member representing local governments appointed on the 35
recommendation of the President Pro Tempore of the Senate. 36
h. One member of the public appointed on the recommendation of the 37
President Pro Tempore of the Senate. 38
No person registered as a lobbyist or lobbyist principal under Chapter 120C of the General 39
Statutes shall be appointed to or serve on the North Carolina State Health Coordinating Rural 40
Healthcare Infrastructure Council. No person previously registered as a lobbyist or lobbyist 41
principal under Chapter 120C of the General Statutes shall be appointed to or serve on the North 42
Carolina State Health Coordinating Rural Healthcare Infrastructure Council within 120 days after 43
the expiration of the lobbyist's or lobbyist principal's registration. 44
(c) Chair. – The members shall elect a chair who shall preside for the duration of the 45
chair's term as a member. In the event a vacancy occurs in the chair before the expiration of the 46
chair's term, the members shall elect an acting chair to serve for the remainder of the unexpired 47
term. 48
(d) Length of Terms. – Members appointed to the Council shall serve for a term of three 49
years. At the end of the respective terms of office of members of the C ouncil, their successors 50
shall be appointed for terms of three years. Any appointment to fill a vacancy on the Council 51
General Assembly Of North Carolina Session 2025
House Bill 1090-Second Edition Page 5
created by the resignation, dismissal, death, or disability of a member shall be filled by the 1
appointing authority for the balance of the unexpired term. As used in this section, the term 2
"appointing authority" means the General Assembly in the case of members appointed by the 3
General Assembly and the Governor in the case of members appointed by the Governor. 4
(e) Removal of Members. – Each appointing authority may remove any member 5
appointed by that appointing authority for misfeasance, malfeasance, or nonfeasance. 6
(f) Filling of Vacancies. – Vacancies on the Council among the membership appointed 7
by the General Assembly shall be filled by the General Assembly as provided in subdivision 8
(b)(2) of this section for the unexpired term. Vacancies on the Council among the membership 9
appointed by the Governor shall be filled by the Governor for the unexpired term. 10
(g) Quorum. – A majority of the members of the Council constitutes a quorum for the 11
transaction of business. 12
(h) Per Diem and Expenses. – The members of the Council shall receive per diem and 13
necessary traveling and subsistence expenses in accordance with the provisions of G.S. 138-5. 14
(i) Administrative Assistance. – The Secretary of Hea lth and Human Services shall 15
supply all clerical and other services required by the Council." 16
SECTION 3.1.(c) Initial appointments to the membership of the North Carolina 17
Rural Healthcare Infrastructure Council shall be made no later than October 1, 2026. 18
Notwithstanding G.S. 131E-74.2, as enacted by subsection (a) of this section and as amended by 19
subsection (b) of this section, the initial terms for the members of the North Carolina Rural 20
Healthcare Infrastructure Council shall be as follows: 21
(1) A term of three years: 22
a. The member licensed to practice medicine in this State under 23
G.S. 131E-74.2(b)(1)g. 24
b. The member who is a registered nurse licensed to practice nursing in 25
this State under G.S. 131E-74.2(b)(1)h. 26
c. The member with experience in data analytics under 27
G.S. 131E-74.2(b)(1)i. 28
d. The member with experience in home health care under 29
G.S. 131E-74.2(b)(2)c. 30
e. The member representing health insurers appointed under 31
G.S. 131E-74.2(b)(2)d. 32
f. The member representing local governments appointed under 33
G.S. 131E-74.2(b)(2)g. 34
g. The public member appointed under G.S. 131E-74.2(b)(2)h. 35
(2) A term of two years: 36
a. The member with experience in public health appointed under 37
G.S. 131E-74.2(b)(1)d. 38
b. The member with experience operating a small business employing 39
fewer than 50 employees on a full -time basis appointed under 40
G.S. 131E-74.2(b)(1)e. 41
c. The member with experience operating a large business employing 42
more than 50 employees on a full -time basis appointed under 43
G.S. 131E-74.2(b)(1)f. 44
d. The member with experience in hospital management appointed under 45
G.S. 131E-74.2(b)(2)b. 46
e. The member with experience in nursing home management appointed 47
under G.S. 131E-74.2(b)(2)f. 48
(3) A term of one year: 49
a. The at -large members appointed under G.S. 131E-74.2(b)(1)a., 50
(b)(2)a., and (b)(2)e. 51
General Assembly Of North Carolina Session 2025
Page 6 House Bill 1090-Second Edition
b. The member with experience in health economics appointed under 1
G.S. 131E-74.2(b)(1)b. 2
c. The member with experience in medical education appointed under 3
G.S. 131E-74.2(b)(1)c. 4
SECTION 3.1.(d) This Part is effective when it becomes law. 5
6
PART IV. REPEAL OF RURAL HEALTH CARE STABILIZATION PROGRAM 7
SECTION 4.1. Article 2 of Chapter 131A of the General Statutes, with the exception 8
of G.S. 131A-32, as recodified and amended by Part I of this act, is repealed. 9
10
PART V. TRANSFERS AND APPROPRIATIONS 11
SECTION 5.1. Effective July 1, 2026, the entire unrestricted cash balance of the 12
Rural Health Care Stabilization Fund within the Office of State Budget and Management (Budget 13
Code 23018) is transferred to the Rural Healthcare Infrastructure Fund created by G.S. 131E-74, 14
as enacted by Section 1.1(b) of this act. The funds transferred are appropriated for the fiscal year 15
in which they are transferred. Any remaining principal and interest payments due to the Rural 16
Health Care Stabilization Fund on or after July 1, 2026, shall be paid to the Rural Healthcare 17
Infrastructure Fund. 18
SECTION 5.2. Notwithstanding G.S. 131E-74(c), as enacted by Section 1.1(b) of 19
this act, there is appropriated from the Rural Healthcare Infrastructure Fund to the Department 20
of Health and Human Services, Division of Central Management and Support, Off ice of Rural 21
Health, the sum of one million dollars ($1,000,000) in nonrecurring funds to fund a contract with 22
Rural Healthcare Initiative, Inc., a nonprofit organization, to continue the work funded by S.L. 23
2023-134 involving the creation of effective models of sustainable healthcare for North Carolina 24
rural communities; to develop cost estimates for achieving the healthcare facilities described in 25
these initial models of sustainable healthcare; and to support the work of the North Carolina Rual 26
Healthcare Infrastructure Council and the Office of Rural Health in developing a plan for the 27
establishment and administration of a Rural Healthcare Infrastructure Program funded by the 28
Rural Healthcare Infrastructure Fund created by G.S. 131E-74, as enacted by Sect ion 1.1(b) of 29
this act. 30
31
PART VI. EFFECTIVE DATE 32
SECTION 6.1. Except as otherwise provided, this act is effective July 1, 2026. 33