Tax Amendment
State lawmakers plan to meet Wednesday for what could be the first vote on a proposed new constitutional amendment. The proposal would limit how much cities and counties can raise property taxes, and possibly even force some cuts.
Wednesday’s planned vote is at a committee that House Speaker Destin Hall set up last year to study different potential changes to property taxes in North Carolina.
If the amendment clears the committee, it would be just the first of possibly many votes. The proposal will have to pass the full state House and Senate — with supermajority support — before it could be put on the ballot for voters to decide.
There’s still enough time that it could be on the 2026 ballot this fall, if it moves through the legislature in the next few months.
Debate over how to tackle property tax reform started small, with lawmakers eyeing specific situations they might want to tackle. Creating new tax loopholes for senior citizens or others on a fixed income, or eliminating existing tax loopholes for hospitals, were some of the items up for debate in prior meetings.
But the proposed constitutional amendment would be far more sweeping in scope, affecting every city and county in the state, and harder to repeal in the future than a normal law.
Property taxes have historically been the responsibility of local government leaders to set, since all of the money stays in those communities to fund police, schools, parks and other priorities. Hall and other Republicans would like the state to get involved now, however, saying they believe some local governments have gotten too aggressive in raising property taxes on their residents.
“Property taxes are out of control,” Hall said when the amendment was first proposed last month. "Families are getting ripped off as some, but by no means all, local governments rake in billions more than inflation and population growth warrant. It’s time for real reform."
But city and county leaders from areas both rural and urban have been raising concerns about the proposed amendment. According to the North Carolina League of Municipalities, which lobbies on behalf of city and town governments, more than half of local spending in North Carolina goes toward public safety — police departments, fire departments, sheriffs’ offices and the like.
The League of Municipalities recently sent a message to local leaders, urging them to call state lawmakers and try to convince them not to move forward.
“Explain the effects of artificial limits on your funding,” the group wrote. “Examples include higher borrowing costs due to the lower bond ratings that would likely result from these limitations; an inability to respond to skyrocketing costs like those experienced this decade; and difficulties in paying for needs after floods and other natural disasters.”
Aside from public safety, much of the rest of any given local government’s budget is spent on roads and schools.
Water Transfer
North Carolina’s population is growing quickly in metro areas like the Triangle, and that means more demand for water in towns like Fuquay-Varina. At the moment, Fuquay-Varina buys wholesale water from Raleigh, Harnett County and Johnston County, according to the N.C. Dept. of Environmental Quality.
But the town’s current contracted water supply isn’t enough to meet projected future demands, so Fuquay-Varina wants its own permanent water supply.
Fuquay-Varina is requesting an Interbasin Transfer Certificate from the state, asking for approval to pull 6.17 million gallons per day from the Cape Fear River Basin, but release its treated wastewater into the Neuse River Basin. This would cost the town about $200 million less than returning the water to the Cape Fear River Basin, according to the environmental impact statement included in the request. Lawmakers and environmentalists are pushing back against the proposal.
A bipartisan group of state senators whose districts collectively represent southeastern North Carolina wrote a letter to the state’s Environmental Management Commission on March 31 opposing the request. The Cape Fear River Basin is pivotal to their communities, they said.
“Nearly one million North Carolinians rely on this river for drinking water, jobs and quality of life. Permanently removing that water puts our communities and our future at risk,” Senate Majority Leader Michael Lee, R-New Hanover, wrote in an April 6 social media post. “We support responsible growth, but not at the expense of southeastern North Carolina.” Lee did not respond to NC Newsline’s request for comment.
The University of North Carolina at Chapel Hill is currently studying surface water transfers in the state. The Southern Environmental Law Center wants the Environmental Management Commission to delay considering the certificate until the study is finished. In its public comments on the issue, SELC described the framework for considering surface water transfers as “outdated.”
The approval process currently includes an environmental impact statement. But Blakely Hildebrand, senior attorney at SELC, said it doesn’t present a “comprehensive or thorough” review of the proposal’s overall effects on surrounding areas.
The public comment period for the transfer request closed on April 1, and staff at DEQ’s Division of Water Resources are reviewing the data to present to the Commission’s Water Allocation Committee in May, according to DWR public information officer Laura Oleniacz.
Legislators face long to-do list for ‘short session’
The 2025 legislative session was notoriously unproductive. Only 97 bills became law, a record low for odd-year legislative sessions, sometimes called “long sessions.” During the long sessions, lawmakers are supposed to iron out the details of a biennial budget. In 2025, they didn’t. That left North Carolina the only state in the nation without a budget. Without the distraction of a looming election, lawmakers also tend to propose more bills and stick around Raleigh longer in the odd-numbered years. However, many of those bills got stuck in one chamber or another, a consequence of the all-consuming budget battle.
Now, last year’s homework will become this session’s late assignment. The 2026 “short” legislative session begins April 21.
The will-they-won’t-they budget saga will take center stage, particularly in light of Rockingham County Republican Senate President Pro Tempore Phil Berger’s recent primary loss. While in theory, only bills that made it through at least one chamber during the long session can be considered during the short session, in reality, anything is possible.
Berger and House Speaker Destin Hall, R-Caldwell, are in a standoff over two aspects of the budget — tax policy and a standalone children’s hospital. Berger is determined to get the last bit of funding for a standalone children’s hospital that he said previous House Speaker Tim Moore agreed to, but Hall isn’t as interested. And while Berger also wants to continue reducing the personal income tax on the way to elimination, Hall wants to pause for a bit for the state to get its bearings. Right now, the income tax rate is 4.25% and according to the most recent consensus revenue forecast, North Carolina has met the triggers to drop to 2.99% by the 2028 tax year with a moderate surplus.
In a statement, Hall said the surplus showed the success of Republican’s “fiscally responsible policies” since 2011. “Unfortunately, this surplus revenue will be entirely consumed by a projected billion-dollar Medicaid rebase. This program must be reformed in order to preserve our ability to fund public safety, education and other priorities.”
Senate Minority Leader Sydney Batch, D-Wake, told reporters that there are “no excuses left” for Republicans not passing a budget after Berger’s primary loss. “They’re asking people to survive on 2023 income, especially our state employees and our teachers, (even though) we have 2026 problems and costs,” she said.
As North Carolinians experience higher costs at the pump, the grocery store and at the doctor’s office, they’re also getting hit with high property tax reevaluations. According to a John Locke Foundation analysis, over the past decade, nine of North Carolina’s 10 most populous counties have overtaxed property owners by nearly $3 billion beyond what inflation and population growth justify.
Lawmakers have mulled their options since the 2025 session ended. Berger, for one, said he would file a bill in April to stop all property tax reevaluations for a year while lawmakers consider changes to the law. That would impact ongoing reevaluations in the Guilford County portion of his district, where assessments are running 40% to 60% higher than before.
In November, voters may get a say on the issue. Lawmakers have tossed around the idea of putting a constitutional amendment on the ballot that would limit how much property tax rates can increase and include various exceptions.
Last session, Gov. Josh Stein vetoed several controversial bills. While several Democrats voted with Republicans to override a few — and suffered primary losses for it — some remain permanently on the calendar.
There are efforts to ban diversity, equity and inclusion efforts in state agencies and schools. One would allow 18-year-olds to conceal carry without a permit. Another would opt North Carolina into a federal tax break for contributions to certain educational scholarship programs. And the last would require various law enforcement agencies to work with Immigration & Customs Enforcement, including by authorizing local law enforcement to perform certain immigration duties.
The three Democrats who lost their primaries — Reps. Carla Cunningham, D-Mecklenburg, Nasif Majeed, D-Mecklenburg and Shelly Willingham, D-Edgecombe — have little incentive to stick with their Democratic caucus now. In particular, it’s possible Cunningham might side with Republicans on the remaining immigration veto override vote, as she has worked with them on that issue before.
Duke Energy is asking the Utilities Commission to allow the company to increase electricity rates by 18% over the next two years. A lot of that increased need comes from data centers, said Dan Crawford, North Carolina League of Conservation Voters senior director of public affairs. He said the environmental community is concerned that legislators might repeal a 2021 law that set a 2050 goal for Duke Energy to reach carbon neutrality. Last session, the 2034 interim goal of 70% carbon emission reduction, which was a part of that law, was eliminated.
Helene recovery remains a major need, as well. Stein requested that lawmakers add $792 million in Helene recovery funding in the budget, focused on economic recovery, affordable housing, private roads and bridges, local government assistance and natural disaster preparation.
Legislative committees have delved into staffing shortages at the Department of Adult Corrections, revisiting math standards, addressing the downstream impacts of SNAP cuts and the implementation of nuclear energy, among other issues.
Finally, the election omnibus bill remains under construction. It’s unclear when the final provisions will be determined, but lawmakers will likely consider an election bill before the 2026 session comes to a close.
Rail Expansion
North Carolina is working with the federal government to expand passenger rail service, according to the head of the North Carolina Department of Transportation's rail division. Jason Orthner testified before the General Assembly's Joint Transportation Oversight Committee on April 2. He answered questions from lawmakers about the state of passenger rail service, known as NC By Train and operated by Amtrak. A record of nearly 740,000 passengers rode the Charlotte-to-Raleigh route in 2025. "This is an incredible increase in ridership and representative not just of our state, but the way these services are growing across the country as well," Orthner told the committee.
For several years, NCDOT has studied the feasibility of expanding that service to cities that don't have passenger rail. Wilmington and Asheville are the two most notable examples, but transportation planners also examined new routes to Morehead City and Greenville.
The state submitted 12 possible corridors to the Federal Railroad Administration's Corridor Identification and Development program. Of these, FRA selected seven for further review: Salisbury-to-Asheville, Raleigh-to-Wilmington, Raleigh-to-Fayetteville, Charlotte-to-Kings Mountain, Raleigh-to-Winston-Salem, Charlotte-to-Atlanta, and Charlotte-to-Washington DC.
"Those are all in a pipeline right now of development with FRA, where FRA is leading the process to ensure those projects are fully evaluated for their cost, schedule and budget," Orthner said. The agency will decide if the corridors merit federal funding, which would cover 80% of construction costs. The state will resubmit the five corridors not selected for the FRA program.