With July 4 rapidly approaching, lawmakers rushed this week to finalize priority legislation before a potential adjournment in the coming weeks. While multiple pieces of legislation we have been tracking all session advanced this week, we are all awaiting the one significant bill to drop — the budget. Rumors about when a budget vote will occur change so quickly that what we heard a minute ago may change by the end of this sentence. Initially, budget leaders were anticipating the possible release of the budget by mid-June. We then heard it will be released before the July 4 holiday, which is likely going to be the case. However, the question remains whether what is passed before the July 4 will be a full budget or just a number of agreed-upon spending provisions, with the remainder to be taken up at some point after the holiday.
Although we end this week without any clear certainty on when we will have a budget vote, lawmakers in both chambers advanced several bills we have been working on this session. While the House passed its version of Regulatory Reform a few weeks ago, the Senate moved its version of Regulatory Reform through multiple committees this week. While the Senate’s bill has some provisions of concern, particularly around permitting, a provision that would have substantially impacted density requirements was removed from the most current draft of the bill. There was also movement this week on a bill that would dictate how local governments manage homeless populations. One significant concern is a right of legal action the bill creates for local governments that do not remove an encampment within five days after a complaint is lodged by a local resident. There will be additional changes made to the liability provision on the Senate floor, but the bill did not move to the floor this week.
Below you will find additional details on these bills, as well as other bills we have been tracking that made progress this week.
Bills on the Move
House Bill 162 – Local Gov’t Applicants/Criminal History Check
Bill Summary: A bill previously intended to require background checks for all city and county applicants who may work with children, now has been changed to restrict local governments’ ability to set parking minimums.
Changes of Note: During the Senate Agriculture, Energy and Environment Committee meeting this week, an amendment was presented and ultimately passed that would change the intent of the bill, to one that resembles another bill we’ve seen this session, House Bill 369. The new intent of the bill is to prohibit local governments from requiring a minimum number of off-street parking spaces and amends the current restriction on regulating parking space dimensions to apply only to off-street parking spaces. It also stipulates that private property owners cannot be required to install new or increased stormwater controls for existing built-upon areas or for redevelopment. It also stipulates that there can be no retroactive application of stormwater control requirements unless allowed by federal law.
The amendment would also only hold stormwater rules to new development only, existing developments would be grandfathered into prior rules and requirements and won’t be subject to new rules. Local governments would be required to update their regulations,and would be permitted to provide incentives should they deem it necessary.
Bill Next Steps: The bill passed in the Senate Agriculture, Energy, and Environment Committee earlier this week and will now head to the Senate Rules Committee.
House Bill 206 – DPS/Other Changes
Bill Summary: This bill would, among other things:
- Give the Department of Public Safety authority to accept a particular land use license;
- Authorize the disposal of certain vehicles;
- Expend the subject matter jurisdiction of Alcohol Law Enforcement agents;
- Make certain changes to the laws related to the Crime Victims Compensation Fund; and
- Modify the law related to the confirmation of the Adjutant General.
Changes of Note: The previous version of House Bill 206 included additional funding for Hurricane Helene relief that had initially been allocated toward Tropical Storm Fred. This provision was removed and will be included in either a broader Helene relief package, or the budget.
Bill Next Steps: House Bill 206 passed third reading in the House and was sent to the Senate by special messenger for consideration.
Senate Bill 280 – Dominique Moody Act
Bill Summary: The bill establishes a specialized escalation team within the North Carolina Division of Social Services (DSS) to investigate cases of high-risk children who have extensive histories with child protective services. It mandates county compliance with the escalation team, including setting reporting requirements and deadlines for county follow-up. The bill also directs the NC Department of Justice to provide recommendations on reducing state liability and placing increased liability on counties if a county DSS office fails to meet the requirements of this law.
Changes of Note: Language was added to clarify that the county DSS staff will need to provide ANY records related to a juvenile’s case if requested by a state escalation specialist.
Bill Next Steps: The bill passed the House and was sent to the Senate for consideration.
Senate Bill 1047 – Regulatory Reform Act of 2026
Bill Summary: This is the Senate’s annual regulatory reform bill, a group of various reform initiatives all bundled into the same bill. Since the House has its own regulatory reform legislation, these bills will likely pass independently in their respective chambers, then be negotiated into a single “conference report” which both chambers will then decide to vote up or down. Sections of the bill that impact counties include:
- Section 13 – This section adds conditional zoning, rezoning, and stormwater permits to the list of permits and land development regulations that can be appealed through judicial court decisions, instead of through current local governing boards.
- Section 14 – This section adds shot clocks for local governments to respond to the filing of applications, permit reviews, and reviews of any required changes. Additionally, it requires the local government to approve or deny an application within 90 days of receiving any final changes to an application. If the local government fails to meet the 90-day shot clock, the application is automatically approved.
- Section 16 – This section states that local governments shall classify residential zoning districts based only on the number of dwelling units per acre, not by lot size. Additionally, it sets limits on how local governments determine allowable density, for example, by not allowing the subtraction of setbacks, open spaces, or nondevelopable areas based on local government requirements. The section also establishes a definition of “dwelling unit” which is unique to the definition of “dwelling” in General Statute 160D, which enumerates local planning and development regulations.
- Section 17 – This section requires local governments to display their fee schedules on their websites and update them within 30 days of any changes. It also requires local governments to provide fee schedules and estimates within 10 days of a completed application and to provide an updated fee estimate after receiving any updated project information. It also requires a final binding fee statement when development approval is issued. Lastly, it also enables applicants to file suit against the local government in superior court if the local government does not comply with the bill.
Changes of Note:
- Adds a 20,000 population threshold for the applicability of permitting application shot clocks.
- Removed Section 16, which would have had substantial impacts on density requirements.
Bill Next Steps: The bill passed the Senate Finance Committee on Thursday, June 18and will now head to the Senate Rules Committee for consideration.
Senate Bill 474 – Adjust Counties/Reappraisal Moratorium
Bill Summary: Senate Bill 474 revises the property tax reappraisal moratorium established in Senate Bill 889 by narrowing its application to counties with January 1, 2026, reappraisals that do not meet specified exclusion criteria, including certain population thresholds, high property tax rates, or designation as Hurricane Helene–affected areas. As amended, the moratorium would apply to Anson, Bladen, Chowan, Davidson, Guilford, Onslow, Pamlico, and Pender Counties, while Clay, Harnett, and Scotland Counties would be excluded from the freeze due to the bill’s revised eligibility criteria. The bill also preserves taxpayers’ ability to appeal 2026 reappraisals during 2027 and creates a temporary special property classification to prevent reductions in the assessed value of public service company system property located in counties subject to the moratorium during the one-year delay, with those special valuation provisions expiring for taxes imposed on or after July 1, 2027.
Changes of Note: None this week
Bill Next Steps: The bill passed the House and was sent to the Senate by special message for consideration.
Senate Bill 992 – Truth in Taxation
Bill Summary: The bill contains numerous provisions for how local governments handle the tax process:
- Requires that, in years when a general reappraisal of real property is conducted, a local governing board must follow new procedures to adopt a property tax rate higher than the revenue-neutral rate.
- Prohibits adoption of a tax rate above the revenue-neutral rate unless a resolution or ordinance is approved after specific notice and hearing requirements.
- Mandates publication of the local government’s interest in exceeding the revenue-neutral rate.
- Requires the county clerk to send notice of intent to exceed the revenue-neutral rate to each taxpayer for each tax board. The notice must include detailed information on the revenue needed, tax rate, estimated amount of tax, and information on the public hearing.
- Requires a public hearing dedicated to the issue of exceeding the revenue-neutral rate, with a majority vote of the governing body needed to approve the higher rate before adopting the budget ordinance.
Changes of Note: The bill was amended in the Senate Finance Committee to remove the burden from county clerks to compile all tax jurisdictions’ notice of intent to exceed a revenue-neutral budget, leaving the responsibility on the individual taxing units to report to their own affected property owners.
Bill Next Steps: The bill received a favorable report in both the Senate State and Local Government Committee and Senate Finance Committee. It will now head to the Senate Rules Committee.
Senate Bill 1001 – Coastal Regulatory Reform
Bill Summary: The bill expands eligible uses of the Coastal Storm Damage Mitigation Fund to include costs associated with permitting, construction, or repair of terminal groins under certain conditions, in addition to existing uses for beach nourishment and dune projects. The bill also appropriates $800,000 in nonrecurring funds to the Coastal Storm Damage Mitigation Fund.
Changes of Note:
- Clarifies what authority agencies have over the Coastal Reserve and spells out the duties and standards for the Department of Environmental Quality (DEQ).
- It updates how nearby waterfront property owners must be notified about permit applications. If applicants send notice by certified mail to both the tax and property addresses at least 60 days before a permit is issued, they don’t need proof the notice was received—but permits cannot be issued until those 60 days have passed if receipt can’t be confirmed.
- DEQ, the Division of Coastal Management, and local permit officials can keep reviewing and processing applications during that 60-day waiting period, but they still cannot issue a permit until the period ends if there’s no proof the notice was received.
- The bill clarifies what “pre-permitting design demonstrations” are. These reviews are only meant to decide whether things like aeration or other measures should be required as permit conditions. It also lists how problems with these demonstrations can be identified (for example, issues with methods, assumptions, data quality, model accuracy, or consistency with water quality standards).
- It makes clear that none of these changes override existing federal or state permits or certifications. DEQ still has full authority to require monitoring or fixes to make sure permit and certification requirements are met.
Bill Next Steps: The bill passed the Senate Agriculture, Energy, and Environment Committee on Tuesday and will now head to the Senate Appropriations/Base Budget Committee.
Senate Bill 1009 – Repeal Hardened Structure Ban
Bill Summary: The bill removes the statewide ban on hardened structures along waterways and empowers the Coastal Resources Commission to adopt rules to regulate placement, construction, and permitting of erosion control structures.
Changes of Note: None this week.
Bill Next Steps: The bill received a favorable report in the Senate Agriculture, Energy, and Environment Committee and will now head to the Senate Appropriations/Base Budget Committee.
Senate Bill 1010 – FUTURE NC Infrastructure Act
Bill Summary: Creates the North Carolina Infrastructure Investment Commission, which will be composed of 10 North Carolinians from across the state that must be appointed by legislative leadership, the Governor, and State Treasurer. The Commission will be tasked with creating a 20-year strategic plan that focuses on investments, innovation, and preservation in various areas, including public health, system resilience, economic and workforce impacts.
Changes of Note: None this week.
Bill Next Steps: The bill passed out of the Senate Transportation Committee on Wednesday, June 17 and will now head to the Senate Appropriations /Base Budget Committee.