NC Gov. Josh Stein praises House GOP’s budget that gained Democratic votes
Democratic Gov. Josh Stein was at the Legislative Building on Wednesday, talking with lawmakers ahead of the first key vote on the House budget.
Before the day was over, the majority of House Democrats voted with Republicans on their budget bill, citing teacher pay and state employee raises among the reasons. And most notable among them was Democratic Leader Robert Reives, of Chatham County.
Good morning and welcome to our Sunday Under the Dome newsletter, which focuses on the governor. I’m Dawn Vaughan, The News & Observer’s Capitol bureau chief.
While Democrats balked at the idea that they voted “with” Republicans, every House Republican and a majority of House Democrats voted in favor of the bill.
“I’m not voting with them, I’m voting with North Carolina. And that is not political speak,” Reives told me Wednesday night after the vote. On Thursday, the House took the final vote to pass the House’s version of the budget.
I also asked Reives about Stein, who was there earlier in the day.
Over a ‘fiscal cliff’
The theme of the House budget was raises, taxes and cuts. The Republican-written House plan gave state employees bigger raises than the proposals of either Stein or the Senate.
The biggest rift now between the House and Senate, however, is likely to be taxes. Both the House and Senate budget bills continue the planned individual income tax rate reduction to 3.99% next year. But after that, the House wants to slow further planned tax cuts, while the Senate does not, and considers the House plan as a tax increase because it doesn’t continue further cuts. As for Stein, he wants tax cuts to just freeze for now, given the cloudy economic situation.
“Gov. Stein recognizes what everybody here who voted “yes” or “no” recognizes,” Reives said in an interview. “We’re not heading towards a fiscal cliff. We are over it. We are working at a deficit, and somebody’s got to figure something out.”
A heads up about the budget
Just before the final round of budget debate, Reives left the floor with Republican House Speaker Destin Hall, and they came back smiling. I asked Hall after session about their conversation. It wasn’t the first time Hall gave Reives a heads up about what was in the final House budget bill. Hall told reporters Reives knew about top-line information days before it was revealed to the public, and he was also told in advance what Republicans were putting in the final budget amendments.
“I’ve tried to talk with Rep. Reives as we move along through the process,” Hall said.
“It’s basically just giving him a heads up on some of the things that we were going to add in there,” Hall said about his talks with Reives, “which — I don’t think I’m speaking out of school — he probably didn’t love some of those things.”
What if there’s a budget veto
It’s up to Hall and Senate leader Phil Berger to make the final decision on a budget deal this summer, if there is one. And that’s the budget they’ll send to Stein’s desk to sign or veto.
Hall said of House Republicans, “Frankly, we want to do all of our caucus’ priorities that we can, and still maintain veto-proof supermajorities.”
While Senate Republicans hold a veto-proof supermajority, meaning they have the three-fifths majority to overturn a Stein veto, the House does not. House Republicans need the vote of at least one Democrat to overturn a Stein veto.
Reives said that House Democrats won’t vote to override a Stein budget veto, and that this vote was part of a negotiated mediation on the bill.
Stein’s statement
In the hours between Stein’s visit to the Legislative Building and the vote, he issued a statement that both praised and criticized the House budget.
“The House’s proposed budget isn’t perfect. But I am pleased that the House raises teacher pay to make North Carolina’s starting teacher salaries the second-highest in the Southeast and rewards our state employees with a raise. The House budget also makes important investments in public safety, child care, and workforce training,” Stein said.
Stein’s thoughts on the Senate budget are far different. He used his statement on the House budget to also criticize the Senate:
“Importantly, the House budget cuts taxes for working families while recognizing that North Carolina is a growing state and reduces personal income tax rates after this year only when the economy is growing. In contrast, the Senate’s fiscally irresponsible revenue scheme will result in fewer teachers and law enforcement officers and diminished services that would harm our people,” Stein said.
The next battle on the budget front is between Republicans in the General Assembly.
Governor cuts in the House budget
I searched through hundreds of references to the governor in the House budget documents, looking for policy or funding that impacts Stein’s office.
I found that among the cuts in the budget was a planned new building for the governor and Council of State, which would have been built in the state government complex in downtown Raleigh. The project was only at the planning stage. The House would not provide more money to build it.
The House budget also would change how the NC Arts Council is appointed. Currently, the governor appoints all 24 members of the council. Instead, the council would be reduced to nine people, with three appointed by the governor, three by the House speaker and three by the Senate president pro tempore.
The change follows what Republicans have done in previous budgets, shifting appointment power away from the governor and giving it to the legislature, which has resulted in multiple lawsuits. This is a lower-profile appointment shift, but notable just the same.
The staff of the governor’s office are state employees, so 20% of the office’s vacant jobs would be cut under the House budget plan, as the plan would do across state government.
Thanks for reading. Contact me at dvaughan@newsobserver.com. Not a newsletter subscriber? Sign up on our website to receive Under the Dome in your inbox daily.
This story was originally published May 25, 2025 at 5:00 AM.
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