NC Republicans End Year-Long Budget Standoff with Teacher Raise Deal
Republican legislative leaders resolve year-long budget dispute with plan for 8% teacher raises and modified tax cuts.
RALEIGH, NORTH CAROLINA — Republican legislative leaders announced Tuesday they have resolved the disputes that blocked passage of North Carolina’s state budget for more than a year, with teachers set to receive average raises of 8% under the new framework.
House Speaker Destin Hall and Senate leader Phil Berger presented the agreement that ends the impasse between the chambers over tax cuts and education spending. North Carolina was the only state in 2025 that failed to pass a new budget due to disagreements between House and Senate Republicans.
“This agreement sets out a good framework for us to move forward,” said Berger (R-Rockingham). “There’s still a lot that will need to be decided and discussed between the two chambers.”
Teacher Pay Increases Lead Budget Framework
The salary structure will make new teachers the highest paid in the South when salary supplements are included, according to Hall (R-Caldwell). Without supplements, starting teacher pay would be $48,000.
State employees will receive average raises of 3%, while law enforcement officers and prison correctional officers would see significantly larger increases with minimum raises of 13%. State retirees would receive a one-time bonus of 2.5%.
Both teachers and state employees would also receive bonuses with amounts dependent on their current salaries, officials said.
Tax Cut Triggers Repealed Under New Plan
The agreement addresses the core dispute that prevented budget passage since 2023. Senate Republicans had wanted to maintain revenue-based triggers for personal income tax cuts and preferred smaller teacher raises, while House Republicans sought to modify those triggers and increase teacher salaries, particularly for new classroom educators.
Under the new framework, personal income tax cut triggers are repealed for the near future in favor of a new schedule, Berger said. However, planned cuts to the personal tax rate remain in place.
The pay increases will not be retroactive but would begin with the budget year starting July 1, according to the legislative leaders.
Budget Details Still Being Finalized
Republican leaders acknowledged significant work remains to finalize the budget legislation. The framework announced Tuesday establishes the major parameters for negotiations between the House and Senate chambers.
North Carolina has operated without a new budget since 2023, relying on continuing resolutions to fund state operations. The prolonged impasse drew criticism from education advocates and state employee groups who argued the delay created uncertainty for public sector workers.
The agreement represents a compromise between the chambers’ previous positions on both education funding and tax policy. Legislative staff will now work to draft detailed budget legislation incorporating the framework announced by Hall and Berger.
