GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 3
HOUSE BILL 171
Committee Substitute Favorable 3/18/25
Committee Substitute #2 Favorable 4/1/25
Short Title: Equality in State Agencies/Prohibition on DEI. (Public)
Sponsors:
Referred to:
February 24, 2025
*H171 -v-3*
A BILL TO BE ENTITLED 1
AN ACT ELIMINATING DIVERSITY, EQUITY, AND INCLUSION (DEI) INITIATIVES IN 2
STATE AND LOCAL GOVE RNMENT AND CLARIFYIN G THE PENALTY 3
PROVISIONS OF THE STATE BUDGET ACT AND LOCAL GOVERNMENT BUDG ET 4
AND FISCAL CONTROL ACT. 5
The General Assembly of North Carolina enacts: 6
7
PART I. NO DEI IN STATE OR LOCAL GOVERNM ENT 8
SECTION 1.1.(a) Article 5 of Chapter 126 of the General Statutes is amended by 9
adding a new section to read: 10
"§ 126-14.7. Equality and merit in State government workplaces; no DEI. 11
(a) No State agency shall promote, support, fund, implement, or maintain workplace 12
diversity, equity, and inclusion (DEI), including using DEI in State government hirings and 13
employment; maintaining dedicated DEI staff positions or offices; or offering or requiring DEI 14
training. 15
(b) The following definitions apply in this section: 16
(1) Differential treatment. – Any distinction, exclusion, or difference in policy, 17
practice, or action that impairs equal access to opportunities or benefits, based 18
on a protected characteristic. This definition does not apply to 19
antidiscrimination measures, reasonable accommodations, legal requirements, 20
or bona fide occupational qualifications. 21
(2) Diversity, equity, and inclusion or DEI. – A program, policy, initiative, or 22
activity designed or implemented to: 23
a. Influence hiring or employment practices with respect to race, sex, 24
color, ethnicity, nationality, country of origin, or sexual orientation 25
other than through the use of merit-based hiring processes in 26
accordance with any applicable State and federal antidiscrimination 27
laws. 28
b. Promote differential treatment of or providing special benefits to 29
individuals on the basis of race, sex, color, ethnicity, nationality, 30
country of origin, or sexual orientation. 31
(3) Protected characteristic. – Any trait protected by State or federal 32
antidiscrimination laws. 33
(c) The State Auditor shall conduct periodic compliance audits to determine whether 34
there has been a violation of this section. If the State Auditor determines that a violation of this 35 General Assembly Of North Carolina Session 2025
Page 2 House Bill 171-Third Edition
section has occurred, the determination shall be reported to the General Assembly, the Joint 1
Legislative Commission on Governmental Operations, and the Attorney General. 2
(d) A State officer or employee who violates this section is subject to removal from office 3
or employment. 4
(e) A State officer or employee who knowingly and willfully violates this section shall 5
be subject to a civil penalty not to exceed five thousand dollars ($5,000) for each violation. The 6
Attorney General may bring a civil action to collect the penalty in superior court which shall be 7
placed in the Civil Penalty and Forfeiture Fund established pursuant to G.S. 115C-457.1. 8
(f) An employee of a State agency may bring a civil action for damages to the employee 9
resulting from violation of this section. The civil action may be brought in the county where the 10
employee resides or in which all or a substantial part of the acts or omissions giving rise to the 11
action occurred. 12
(g) Any person may bring a civil action for a violation of this section seeking injunctive 13
or declaratory relief and the recovery of reasonable attorneys' fees and costs. The action may be 14
brought in the county in which all or a substantial part of the acts or omissions giving rise to the 15
action occurred. 16
(h) Nothing in this section shall be construed to do any of the following: 17
(1) Conflict with, restrict, limit, or infringe upon speech protected by the First 18
Amendment of the U.S. Constitution. 19
(2) Conflict with or prohibit compliance with Title IX of the Education 20
Amendments of 1972, as amended; the Americans with Disabilities Act, as 21
amended; the Age Discrimination in Employment Act, as amended; Title VI 22
of the Civil Rights Act of 1964; or other applicable State or federal law. 23
(3) Alter the relationship between the State and an American Indian tribe which 24
shall continue to enjoy all rights, privileges, and immunities as an American 25
Indian tribe with a recognized tribal governing body carrying out and 26
exercising substantial governmental duties and powers similar to the State, 27
being recognized as eligible for the special programs and services provided 28
by the United States to Indians because of their status as Indians. 29
(4) Apply to the North Carolina State Commission of Indian Affairs and Indian 30
education services and positions. 31
(5) Prohibit the celebration of any holiday, observance, or remembrance. 32
(i) The provisions of this section are severable. If any provision of this section or its 33
application is held invalid, that invalidity shall not affect other provisions or applications that can 34
be given effect without the invalid provision or application." 35
SECTION 1.1.(b) G.S. 126-5 is amended by adding a new subsection to read: 36
"(c22) Notwithstanding any provision of law to the contrary, G.S. 126-14.7 shall apply to all 37
(i) nonexempt State employees in the executive branch, including nonexempt employees of The 38
University of North Carolina and nonexempt employees of the Community Colleges System 39
Office, and (ii) community college employees." 40
SECTION 1.2. Article 10 of Chapter 143 of the General Statutes is amended by 41
adding a new section to read: 42
"§ 143-162.8. No public funds for DEI. 43
(a) No State agency, unit of local government, or covered school may use any State funds 44
or public monies to promote, support, fund, implement, or maintain diversity, equity, and 45
inclusion (DEI) initiatives or programs. 46
(b) No State agency, unit of local government, or covered school shall apply for, accept, 47
or utilize federal funds, grants, or other financial assistance that require compliance with DEI 48
policies, initiatives, or mandates. Any existing programs funded through such means shall be 49
discontinued unless continued participation is expressly required by federal law. 50
(c) The following definitions apply in this section: 51 General Assembly Of North Carolina Session 2025
House Bill 171-Third Edition Page 3
(1) Diversity, equity, and inclusion or DEI. – A program, policy, initiative, or 1
activity designed or implemented to: 2
a. Influence State government practices with respect to race, sex, color, 3
ethnicity, nationality, country of origin, or sexual orientation other 4
than for compliance with applicable State and federal 5
antidiscrimination laws. 6
b. Promote (i) differential treatment of or providing special benefits to 7
individuals on the basis of race, sex, color, ethnicity, nationality, 8
country of origin, or sexual orientation; or (ii) a difference in policy, 9
practice, or action that impairs equal access to opportunities or 10
benefits, based on a protected characteristic. This definition does not 11
apply to antidiscrimination measures, reasonable accommodations, 12
legal requirements, bona fide occupational qualifications, or any trait 13
protected by State or federal antidiscrimination laws. 14
(2) Covered school. – Any of the following: 15
a. A local school administrative unit as defined in G.S. 115C-5. 16
b. A regional school. 17
c. A school providing elementary or secondary instruction operated by 18
The University of North Carolina under Article 29A of Chapter 116 of 19
the General Statutes. 20
d. Schools for the deaf and blind operated under Article 9C Chapter 115C 21
of the General Statutes. 22
(3) Public monies. – Funds from any source budgeted or expended by a local 23
political subdivision of the State, including revenue authorized by 24
G.S. 153A-149 or G.S. 160A-209. 25
(4) State agency. – A unit of the executive, legislative, or judicial branch of State 26
government, such as a department, institution, division, commission, board, 27
council, community college, or The University of North Carolina system. 28
(5) State funds. – As defined in G.S. 143C-1-1. The term includes any monies 29
received or held by a constituent institution of The University of North 30
Carolina, including endowment funds as defined in G.S. 116-36 and 31
institutional trust funds as defined in G.S. 116-36.1. 32
(6) Unit of local government. – As defined in G.S. 143C-1-1. 33
(d) The prohibitions contained in subsections (a) and (b) of this section include using 34
State funds or public monies to do any of the following: 35
(1) Utilize DEI in hirings, employment, admissions, or the awarding of contracts. 36
(2) Offer or require DEI training. 37
(3) Maintain DEI offices or dedicated staff positions, whether permanent, 38
time-limited, full-time, part-time, or temporary. 39
(e) Nothing in this section shall be construed to do any of the following: 40
(1) Conflict with, restrict, limit, or infringe upon speech protected by the First 41
Amendment of the U.S. Constitution. 42
(2) Conflict with or prohibit compliance with Title IX of the Education 43
Amendments of 1972, as amended; the Americans with Disabilities Act, as 44
amended; the Age Discrimination in Employment Act, as amended; Title VI 45
of the Civil Rights Act of 1964; or other applicable State or federal law. 46
(3) Alter the relationship between the State and an American Indian tribe which 47
shall continue to enjoy all rights, privileges, and immunities as an American 48
Indian tribe with a recognized tribal governing body carrying out and 49
exercising substantial governmental duties and powers similar to the State, 50 General Assembly Of North Carolina Session 2025
Page 4 House Bill 171-Third Edition
being recognized as eligible for the special programs and services provided 1
by the United States to Indians because of their status as Indians. 2
(f) This section shall not be construed to apply to any of the following: 3
(1) Academic course instruction. 4
(2) Scholarly research or a creative work by an institution of higher education's 5
students, faculty, or other research personnel or the dissemination of that 6
research or work. 7
(3) An activity of a student organization registered with or recognized by an 8
institution of higher education. 9
(4) Guest speakers or performers on short-term engagements. 10
(5) A policy, practice, procedure, program, or activity to enhance student 11
academic achievement or postgraduate outcomes that is designed and 12
implemented without regard to race, sex, color, or ethnicity. 13
(6) Data collection. 14
(7) Bona fide qualifications based on sex which are reasonably necessary to the 15
normal operation of public higher education, including: 16
a. Sports teams organized by sex. 17
b. Single-sex bathrooms and locker rooms. 18
c. Requiring a maintenance employee assigned to a single-sex locker 19
room to be a member of that respective sex. 20
d. Fraternities and sororities restricted to members of one sex. 21
e. Having single-sex housing options for students. 22
(8) The North Carolina State Commission of Indian Affairs. 23
(9) Indian education services and positions. 24
(10) The celebration of any holiday, observance, or remembrance. 25
(g) A person who knowingly and willfully violates this section is subject to a civil penalty 26
not to exceed ten thousand dollars ($10,000) per violation. Each expenditure or action taken in 27
contravention of this section constitutes a separate violation. The Attorney General may bring a 28
civil action to collect the penalty in superior court which shall be placed in the Civil Penalty and 29
Forfeiture Fund established pursuant to G.S. 115C-457.1. In any such action, the court may also 30
award injunctions to prevent ongoing violations. 31
(h) A violation of this section is subject to the applicable civil penalty provisions of 32
G.S. 143C-10-3, 159-182(b), or 159-183. 33
(i) Beginning February 1, 2026, and annually thereafter, each State agency, unit of local 34
government, and covered school shall prepare and publicly post on its website, as well as submit 35
to the Office of the State Auditor, a report detailing the actions taken to comply with this section. 36
The report must include each instance where a program or policy was revised or prohibited due 37
to a conflict with this section. The State Auditor shall compile this information and submit a 38
consolidated report to the Joint Legislative Commission on Governmental Operations and the 39
General Assembly by April 1, 2026, and then annually thereafter. 40
(j) The State Auditor shall conduct periodic compliance audits to determine whether 41
there has been a violation of this section. If the State Auditor determines that a violation of this 42
section has occurred, the determination shall be referred to the Attorney General for appropriate 43
civil enforcement action. The State Auditor shall report all violations to the Joint Legislative 44
Commission on Governmental Operations and, if appropriate, shall report an individual violation 45
to the Local Government Commission. 46
(k) Any person may bring a civil action for a violation of this section seeking injunctive 47
or declaratory relief and the recovery of reasonable attorneys' fees and costs. The civil action 48
shall be brought in the county in which all or a substantial part of the acts or omissions giving 49
rise to the action occurred. 50 General Assembly Of North Carolina Session 2025
House Bill 171-Third Edition Page 5
(l) An employee of a State agency, unit of local government, or covered school may 1
bring a civil action for damages to the employee resulting from a violation of this section. The 2
civil action may be brought in the county where the employee resides or in which all or a 3
substantial part of the acts or omissions giving rise to the action occurred. 4
(m) The liability and penalty provisions contained in this section for violating its 5
provisions are in addition to, and not in lieu of, liability under any other applicable provision of 6
law or cause of action in consequence of the violation. 7
(n) The provisions of this section are severable. If any provision of this section or its 8
application is held invalid, that invalidity shall not affect other provisions or applications that can 9
be given effect without the invalid provision or application." 10
SECTION 1.3.(a) Article 10 of Chapter 143C of the General Statutes reads as 11
rewritten: 12
"Article 10. 13
"Penalties. 14
"§ 143C-10-1. Offenses for violation of Chapter. 15
… 16
(c) Forfeiture of Office or Employment. – An appointed officer or employee of the State 17
or an officer or employee of a political subdivision of the State, whether elected or appointed, 18
forfeits his or her office or employment upon conviction of an offense under this section. An 19
elected officer of the State is subject to impeachment for committing any of the offenses specified 20
in this section. 21
"§ 143C-10-2. Civil liability for violation of Chapter. 22
(a) A person convicted of an offense under who violates G.S. 143C-10-1 is liable in a 23
civil action for any damages suffered by the State in consequence of the offense. A State agency 24
shall have a duty to pursue the recoupment of misspent funds by all lawful means available, 25
including the filing of a civil action in the General Court of Justice. 26
(b) Any person may bring a civil action for a violation of this section seeking injunctive 27
or declaratory relief and the recovery of reasonable attorneys' fees and costs. The civil action 28
shall be brought in the county in which all or a substantial part of the acts or omissions giving 29
rise to the action occurred. 30
"§ 143C-10-3. Suspension from office or impeachment for refusal to comply with Chapter. 31
(a) State Officers or Employees of the Executive Branch. – The Governor may suspend 32
from the performance of his or her duties any State officer or employee of the executive branch 33
except an officer elected by the people, who persists, after notice and warning, in failing or 34
refusing to comply with the provisions of this Chapter or any lawful administrative directive 35
issued pursuant to this Chapter. Before acting to suspend, the Governor shall give the accused 36
notice and an opportunity to be heard in his or her own defense. The Governor shall report the 37
facts leading to suspension to the district attorney for the county in which all or a substantial part 38
of the violation occurred and to the Attorney General who may initiate appropriate criminal or 39
civil proceedings. The Governor may apply to the General Court of Justice for a restraining order 40
and injunction if a suspended officer or employee persists in performing official acts. 41
(b) Elected Officers. – A State officer elected by the people who knowingly and willfully 42
fails or refuses to comply with any provision of this Chapter or any lawful administrative 43
directive issued under this Chapter is subject to impeachment." 44
SECTION 1.3.(b) G.S. 159-182 reads as rewritten: 45
"§ 159-182. Offending officers and employees removed from office. 46
(a) If an officer or employee of a local government or public authority persists, after 47
notice and warning from the Commission, in failing or refusing to comply with any provision of 48
this Chapter, he the officer or employee forfeits his the office or employment. The Commission 49
may enter an order suspending the offender from further performance of his or her office or 50
employment after first giving him or her notice and an opportunity to be heard in his or her own 51 General Assembly Of North Carolina Session 2025
Page 6 House Bill 171-Third Edition
defense, pending the outcome of quo warranto proceedings. Upon suspending a local officer or 1
employee under this section, the Commission shall report the circumstances to the Attorney 2
General who shall initiate quo warranto proceedings against the officer or employee in the 3
General Court of Justice. Justice and to the district attorney for the county in which all or a 4
substantial part of the noncompliance occurred. If an officer or employee persists in performing 5
any official act in violation of an order of the Commission suspending him or her from 6
performance of his or her duties, the Commission may apply to the General Court of Justice for 7
a restraining order and injunction. 8
(b) Any person may bring a civil action for a violation of this section seeking injunctive 9
or declaratory relief and the recovery of reasonable attorneys' fees and costs. The civil action 10
shall be brought in the county in which all or a substantial part of the acts or omissions giving 11
rise to the action occurred." 12
SECTION 1.3.(c) Article 11 of Chapter 159 of the General Statutes is amended by 13
adding a new section to read: 14
"§ 159-183. Violation of G.S. 143-162.8. 15
(a) A person who knowingly and willfully violates G.S. 143-162.8 regarding the use of 16
public monies by a unit of local government shall be subject to a civil penalty not to exceed ten 17
thousand dollars ($10,000) per violation. An offending officer or employee is subject to removal 18
from office or employment as provided by G.S. 159-182. The Attorney General may initiate a 19
civil action to enforce the penalty under this section. 20
(b) A person who violates G.S. 143-162.8 is liable for any damages suffered by a unit of 21
local government in consequence of the offense. A unit of local government or entity receiving 22
public funds shall have a duty to pursue the recoupment of misspent funds by all lawful means 23
available, including the filing of a civil action in the General Court of Justice." 24
25
PART II. EFFECTIVE DATE 26
SECTION 2.1. This act becomes effective December 1, 2025, and applies to acts or 27
omissions occurring on or after that date. 28