Change to Needs-Based Capital Funding.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 706

Short Title: Change to Needs-Based Capital Funding. (Public)
Sponsors: Representatives Lopez, Majeed, Belk, and Johnson-Hostler (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Rules, Calendar, and Operations of the House
April 3, 2025
*H706-v-1*
A BILL TO BE ENTITLED 1
AN ACT TO MODIFY THE PRIORITIZATION OF THE ALLOCATION OF GRANTS FOR 2
THE NEEDS -BASED PUBL IC SCHOOL CAPITAL FU ND AND TO OTHERWISE 3
PROHIBIT THE ALLOCAT ION OF EDUCATION FUN DS BASED ON THE 4
ECONOMIC TIER DESIGN ATIONS ASSIGNED BY T HE DEPARTMENT OF 5
COMMERCE. 6
The General Assembly of North Carolina enacts: 7
SECTION 1. G.S. 115C-546.11(a) reads as rewritten: 8
"(a) An eligible county awarded a grant under this Article shall provide local matching 9
funds from county funds, other non-State funds, or a combination of these sources for the grant 10
as provided in this section. An eligible county is (i) a county with an adjusted market value of 11
taxable real property of less than forty billion dollars ($40,000,000,000). ($40,000,000,000) or 12
(ii) a county that contains census tracts that are experiencing persistent poverty or are identified 13
as having low to moderate income, as identified by the United States Department of Housing and 14
Urban Development. The adjusted market value of taxable property in a county is equal to the 15
county's assessed taxable real property value, using the latest available data published by the 16
Department of Revenue, divided by the county's sales assessment ratio determined under 17
G.S. 105-289(h). The amount of matching funds for a county awarded a grant shall be published 18
annually by the Department of Public Instruction prior to any application period. The local match 19
requirement applied to the project shall be based on the match requirement effective at the time 20
of the grant award. The A county that is eligible due to containing census tracts that are 21
experiencing persistent poverty or are identified as having low to moderate income but has an 22
adjusted market value of taxable real property of greater than forty billi on dollars 23
($40,000,000,000) shall have a local match requirement of thirty-five percent (35%). For all other 24
eligible counties, the local match requirement is calculated as follows: 25
Adjusted Market Value of Taxable Real Property 26
27
Over Up to Percentage Match 28
$0 $2 billion 0% 29
$2 billion $10 billion 5% 30
$10 billion $20 billion 15% 31
$20 billion $30 billion 25% 32
$30 billion $40 billion 35%" 33
SECTION 2.(a) Subsections (c), (d), and (e) of Section 7.22 of S.L. 2017 -57 are 34
repealed. 35
General Assembly Of North Carolina Session 2025
Page 2 House Bill 706-First Edition
SECTION 2.(b) Notwithstanding any other provision of law, beginning with the 1
2025-2026 fiscal year, the Department of Public Instruction shall allocate in an equal amount per 2
school on a recurring basis the cooperative innovative high school supplemental allotment to 3
local school administrative units for each cooperative innovative high school located in the unit 4
that (i) is approved by the State Board of Education pursuant to G.S. 115C-238.51A(c) and (ii) 5
received funds for the cooperative innovative high school supplemental allotment for the 6
2025-2027 fiscal biennium. 7
SECTION 3. Notwithstanding any provision of law to the contrary, beginning with 8
the 2025-2026 fiscal year and subsequent fiscal years thereafter, no State agency responsible for 9
the allocation of State funds for education purposes to the elementary and secondary public 10
schools of the State, community colleges under the jurisdiction of the State Board of Community 11
Colleges, or the constituent institutions of The University of North Carolina shall be directed to 12
or shall use the economic development tier designation for a county assigned by the Department 13
of Commerce pursuant to G.S. 143B-437.08 as the basis for the allocation of those State f unds, 14
including for grant programs, proceeds from the issuance of bonds, or supplemental allotments 15
to public schools and institutions of higher education supported by State funds. 16
SECTION 4. All laws and clauses of laws in conflict with this act are repealed. 17
SECTION 5. This act becomes effective July 1, 2025. Section 1 of this act applies 18
to grant applications submitted on or after that date. 19