House Budget Released: Impact on NC Children

The proposed House budget restores some funding for key child programs that were cut last year, though not nearly to the level of the Governor’s proposed budget, which focused heavily on public education investments. There are also, however, some concerning cuts to children’s programs in the House budget, and places where badly needed funds cut last year were not restored.

The proposed House budget increases total funding for state government by about 1.6 percent over the budget approved last year. The Governor’s proposed budget increased funding by 4.9 percent. The House budget does not include the temporary sales tax increase that allowed the Governor to invest more heavily in public education.

Below are some highlights from the Health and Human Services, Public Education and Juvenile Justice sections of the proposed House budget. Please visit Action for Children’s website ( for a detailed line-by-line comparison of the Governor’s budget and the House budget.

Health and Human Services

The House budget increases Health and Human Services funding by 3.7 percent over the budget approved last year. For comparison, the Governor’s budget increased funding for HHS by about 4 percent. Some highlights by division include:


Division of Central Management and Support

  • 50 vacant positions eliminated
  • $9.2 million in nonprofit funding changed from recurring to nonrecurring, meaning the dollars will have to be re-appropriated each year
  • A directive to cut $5 million in funding to nonprofits, avoiding direct services when possible and avoiding cuts to services for individuals with developmental disabilities

Division of Child Development and Early Education

  • Smart Start: $4 million shift from state funds to federal funds and $3.5 million for specific uses — pilot literacy program, helping rural partnerships with fundraising, etc. The Governor’s budget increased Smart Start funding by $18.2 million.
  • NC Pre-K: $15 million, which would fund 1,765 students and begin to make up the cut from last year. The Governor’s budget increased NC Pre-K funding by $25 million.

Division of Public Health

  • Tobacco Prevention, Cessation: $5.5 million. The Governor’s budget invested $10 million.
  • High Risk Pregnancy Clinic at ECU: $375,000. Healthy Start Foundation is cut by $434,000 jeopardizing the Safe Sleep campaign.
  • County Health Departments: $8.5 million. The Division is directed to reduce contracts with outside vendors for family planning services, presumably to eliminate state funding to Planned Parenthood.

 Division of Medical Assistance

  • Medicaid Rebase: Increase of $168 million to cover projected growth in enrollment and consumption.
  • Medicaid Fraud, Waste and Abuse elimination: $3.8 million, about the same as the Governor’s budget.
  • Savings from implementing/expanding Community Cares for North Carolina (CCNC), a managed care program: $59 million in projected savings. The division must find these savings if they don’t materialize. The Governor’s budget did not include this item.

NC Health Choice 

  • Reductions should not change open enrollment policy of the NC Health Choice program; same as the Governor’s budget.

Division of Mental Health

  • Reduce Community Services funding: $10 million. Governor’s budget does not reduce community-based services.
  • Community beds: $18.2 million to increase beds by 91. Governor’s budget increases local beds by $10 million.
  • Cherry and Broughton hospitals: $3.5 million each for more beds and staff.

Public Education

The House proposed budget increases funding for public education by 3.3 percent over the budget approved last year. The Governor’s budget increased public education funding by 7.6 percent. Highlights include:

  • LEA adjustment: The House budget puts back 66 percent of the funds that would have been taken away from local school systems based on the budget approved last year ($333 million), but $227 million of that restoration is in non-recurring dollars, which means the funds will have to be re-appropriated each year. The Governor’s budget restored $503 million of those funds.
  • Teacher raises, reduce class size, assessments: The Governor’s budget included $132 million for these items. The House budget does not include them.
  • Residential Schools: The House budget restores $5.2 million for residential schools, which should prevent the closure of any of the schools.
  • Teacher mentoring and the NC Center for the Advancement of Teaching: The Governor’s budget included $12 million for these two items. House budget does not include them.

Juvenile Justice

The House budget specifically says that no reductions are to be taken from community programs in the Division of Juvenile Justice, including multi-purpose group homes, residential treatment providers and Juvenile Crime Prevention Councils. The Edgecombe YDC is proposed for closure ($1.7 million), and eight beds are to be moved to the Chatham and Lenoir YDCs. The expected impact of this closure is unclear.

Action for Children North Carolina