GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 365
Short Title: Workforce Education Act. (Public)
Sponsors: Representatives Reives, Willis, Campbell, and Roberson (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Appropriations, if favorable, Rules, Calendar, and Operations of the House
March 12, 2025
*H365 -v-1*
A BILL TO BE ENTITLED 1
AN ACT TO DIRECT THE STATE BOARD OF COMM UNITY COLLEGES TO REVISE ITS 2
FUNDING MODEL FOR CO MMUNITY COLLEGES AND ESTABLISH 3
ENROLLMENT INCREASE RESERVE, TO EXPAND FUNDING FOR COOPERATI VE 4
INNOVATIVE HIGH SCHO OLS, TO CREATE GRANT PROGRAMS FOR THE 5
DEPARTMENT OF PUBLIC INSTRUCTION TO PROM OTE CTE PROGRAMS AND 6
OTHER EDUCATIONAL OP PORTUNITIES, AND TO PROMOTE COMMUNITY 7
COLLEGE ENROLLMENT T O PUBLIC SCHOOL STUDENTS. 8
The General Assembly of North Carolina enacts: 9
10
PART I. DIRECT THE STATE BOARD OF COMMUNITY COLLEGES TO REVISE 11
ITS FUNDING MODEL FO R COMMUNITY COLLEGES AND ESTABLISH 12
ENROLLMENT INCREASE RESERVE 13
SECTION 1.(a) The following session laws are repealed: 14
(1) Subsection (b) of Section 8.3 of S.L. 2011-145. 15
(2) Subsection (a) of Section 10.4 of S.L. 2013-360. 16
SECTION 1.(b) The State Board of Community Colleges shall revise its funding 17
formula for community colleges and allocate funds under that revised formula, beginning with 18
the 2025-2026 fiscal year, according to the following minimum criteria: 19
(1) Each community college shall continue to receive a base allocation of funds. 20
(2) In addition to the base allocation of funds, funds shall be provided to 21
community colleges based on the number of full-time equivalent (FTE) 22
students enrolled in the following: 23
a. Curriculum, workforce continuing education, and Basic Skills courses. 24
b. Courses and programming conducted under the Customized Training 25
Program and the Small Business Center Network. 26
(3) Community colleges shall calculate FTE enrollment as the higher of the 27
current year's total enrollment or the average enrollment of the last two 28
academic years. 29
(4) Funds allocated pursuant to subdivision (2) of this subsection shall be 30
weighted based on the workforce sector of each course, as determined by the 31
State Board. In making its determinations, the State Board shall consider 32
salary data and labor market demand for the applicable workforce sector. 33
SECTION 1.(c) G.S. 115D-5 is amended by adding a new subsection to read: 34 General Assembly Of North Carolina Session 2025
Page 2 House Bill 365-First Edition
"(aa) The State Board of Community Colleges shall review and revise, as necessary, its 1
workforce sector designations for curriculum, workforce continuing education, and Basic Skills 2
courses at community colleges by January 15, 2027, and every two years thereafter." 3
SECTION 1.(d) G.S. 115D-31(e) reads as rewritten: 4
"(e) If receipts for community college tuition and fees exceed the amount certified in 5
General Fund Codes at the end of a fiscal year, the State Board of Community Colleges shall 6
transfer the amount of receipts and fees above those budgeted to the Enrollment Growth Reserve. 7
may allocate those receipts to the community colleges for operating costs according to a formula 8
adopted by the State Board. Funds in the Enrollment Growth Reserve allocated pursuant to this 9
subsection shall not revert to the General Fund and shall remain available to the State Board until 10
expended. The State Board may allocate funds in this reserve to colleges experiencing an 11
enrollment increase greater than five percent (5%) of budgeted enrollment levels." 12
SECTION 1.(e) G.S. 115D-31 is amended by adding a new subsection to read: 13
"(e1) The State Board shall administer the Enrollment Increase Reserve as provided in 14
G.S. 115D-31.4." 15
SECTION 1.(f) Article 3 of Chapter 115D of the General Statutes is amended by 16
adding the following new section to read: 17
"§ 115D-31.4. Enrollment Increase Reserve. 18
(a) There is established the Enrollment Increase Reserve (Reserve) to be administered by 19
the State Board of Community Colleges. The purpose of the Reserve is to allow the State Board 20
to provide funds to community colleges to account for enrollment increases beyond budgeted 21
enrollment levels. 22
(b) Monies in the Reserve shall consist of funds appropriated by the General Assembly 23
in the Current Operations Appropriations Act for a fiscal year. The State Board shall include in 24
its annual enrollment request the appropriation to the Reserve that is needed to fund enrollment 25
increases in the next fiscal year. 26
(c) The State Board may allocate monies from the Reserve to a community college with 27
an eligible increase in full-time equivalent (FTE) enrollment according to a formula adopted by 28
the State Board. An eligible increase in FTE enrollment is either of the following: 29
(1) An increase in FTE enrollment of more than five percent (5%) of the budgeted 30
enrollment level in any of the following course categories: 31
a. Curriculum. 32
b. Workforce continuing education. 33
c. Basic Skills. 34
(2) An increase in total FTE enrollment of more than 325 students. 35
(d) Monies in the Reserve shall not revert at the end of each fiscal year but shall remain 36
available until expended for the purposes of this section." 37
SECTION 1.(g) There is appropriated from the General Fund to the Community 38
Colleges System Office the sum of ninety-four million dollars ($94,000,000) in recurring funds 39
for the 2025-2026 fiscal year to implement subsections (a) through (d) of this section. There is 40
appropriated from the General Fund to the Enrollment Increase Reserve, as established by this 41
section, the sum of six million dollars ($6,000,000) in nonrecurring funds for the 2025-2026 42
fiscal year for the purposes described in G.S. 115D-31.4, as enacted by this section. 43
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PART II. COOPERATIVE INNOVATIVE HIGH SCH OOL FUNDING EXPANSIO N 45
SECTION 2.(a) Part 9 of Article 16 of Chapter 115C of the General Statutes is 46
amended by adding a new section to read: 47
"§ 115C-238.54A. Cooperative innovative high schools – funding based on county 48
development tier designation. 49
(a) Development Tier One Areas. – The Department shall allocate the following amounts 50
from the cooperative innovative high school supplemental allotment to a local school 51 General Assembly Of North Carolina Session 2025
House Bill 365-First Edition Page 3
administrative unit located in a development tier one area as defined in G.S. 143B-437.08 with a 1
cooperative innovative high school that was approved by the State Board of Education pursuant 2
to G.S. 115C-238.51A(c): 3
(1) The sum of seven hundred forty thousand dollars ($740,000) in recurring 4
funds for the first cooperative innovative high school approved by the State 5
Board. 6
(2) The sum of three hundred seventy thousand dollars ($370,000) in recurring 7
funds for each subsequent cooperative innovative high school approved by the 8
State Board. 9
(3) For a virtual cooperative innovative high school, the Department shall allocate 10
the sum of two hundred thousand dollars ($200,000) in recurring funds from 11
the cooperative innovative high school supplemental allotment to the local 12
school administrative unit for each fiscal year. 13
(4) For the Northeast Regional School of Biotechnology and Agriscience, the 14
Department shall allocate the sum of three hundred ten thousand dollars 15
($310,000) in recurring funds from the regional school supplemental 16
allotment for the school for each fiscal year. 17
(b) Development Tier Two Areas. – The Department shall allocate the following amounts 18
from the cooperative innovative high school supplemental allotment to a local school 19
administrative unit located in a development tier two area as defined in G.S. 143B-437.08 with 20
a cooperative innovative high school that was approved by the State Board of Education pursuant 21
to G.S. 115C-238.51A(c): 22
(1) The sum of five hundred ninety thousand dollars ($590,000) in recurring funds 23
for the first cooperative innovative high school approved by the State Board. 24
(2) The sum of two hundred ninety-five thousand dollars ($295,000) in recurring 25
funds for each subsequent cooperative innovative high school approved by the 26
State Board. 27
(3) For a virtual cooperative innovative high school, the Department shall allocate 28
the sum of two hundred thousand dollars ($200,000) in recurring funds from 29
the cooperative innovative high school supplemental allotment to the local 30
school administrative unit for each fiscal year. 31
(c) Development Tier Three Areas. – The Department shall allocate the following 32
amounts from the cooperative innovative high school supplemental allotment to a local school 33
administrative unit located in a development tier three area as defined in G.S. 143B-437.08 with 34
a cooperative innovative high school that was approved by the State Board of Education pursuant 35
to G.S. 115C-238.51A(c): 36
(1) The sum of five hundred fifty thousand dollars ($550,000) in recurring funds 37
for the first cooperative innovative high school approved by the State Board. 38
(2) The sum of two hundred seventy-five thousand dollars ($275,000) in recurring 39
funds for each subsequent cooperative innovative high school approved by the 40
State Board. 41
(3) For a virtual cooperative innovative high school, the Department shall allocate 42
the sum of two hundred thousand dollars ($200,000) in recurring funds from 43
the cooperative innovative high school supplemental allotment to the local 44
school administrative unit for each fiscal year. 45
(d) Applicability of Funds Allocated Pursuant to this Section. – The allotment of funds 46
to local school administrative units pursuant to the provisions of this section shall include a 47
cooperative innovative high school approved by the State Board of Education pursuant to 48
G.S. 115C-238.51A(c) since July 1, 2015, that is operated by a local school administrative unit 49
but that has not received the cooperative innovative high school allotment in a prior fiscal year. 50 General Assembly Of North Carolina Session 2025
Page 4 House Bill 365-First Edition
Funds shall not be allocated to local school administrative units for cooperative innovative high 1
schools approved by the State Board pursuant to G.S. 115C-238.51A(b)." 2
SECTION 2.(b) There is appropriated from the General Fund to the Department of 3
Public Instruction the sum of forty million dollars ($40,000,000) in recurring funds for the 4
2025-2026 fiscal year to implement the provisions of this section. 5
6
PART III. DEPARTMENT OF PUBLIC INSTRUCTION GRANT PROGRAMS 7
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GRANTS FOR STEM EDUCATION 9
SECTION 3.1. There is appropriated from the General Fund to the Department of 10
Public Instruction the sum of thirty million dollars ($30,000,000) in recurring funds for the 11
2025-2026 fiscal year to create a grant program in collaboration with the Community Colleges 12
System Office for public school units to promote science, technology, engineering, and math 13
(STEM) education. Grants shall be used for professional development, classroom technology, 14
lab upgrades, or coding programs for teachers teaching STEM courses. The Department shall 15
make an application for grants available to public school units prior to August 1 of each school 16
year. Public school units applying for grants shall submit their application to the Department by 17
October 1 of each school year. The Department shall make determinations on grant recipients by 18
November 1 of each school year and disburse grants funds within 60 days of making the 19
determination. 20
21
GRANTS TO EXPAND CTE OPPORTUNITIES 22
SECTION 3.2. There is appropriated from the General Fund to the Department of 23
Public Instruction the sum of twenty million dollars ($20,000,000) in recurring funds for the 24
2025-2026 fiscal year to create a grant program in collaboration with the Community Colleges 25
System Office for public school units to expand career and technical education course offerings, 26
dual enrollment opportunities, and certification pathways for students in grades nine through 12. 27
The Department shall make an application for grants available to public school units prior to 28
August 1 of each school year. Public school units applying for grants shall submit their 29
application to the Department by October 1 of each school year. The Department shall make 30
determinations on grant recipients by November 1 of each school year and disburse grants funds 31
within 60 days of making the determination. 32
33
INDUSTRY-SCHOOL PARTNERSHIP GRANTS 34
SECTION 3.3. There is appropriated from the General Fund to the Department of 35
Public Instruction the sum of twenty-five million dollars ($25,000,000) in recurring funds for the 36
2025-2026 fiscal year to create a grant program in collaboration with the Community Colleges 37
System Office for public school units to create industry-school partnerships to facilitate 38
internships, apprenticeships, and project-based learning opportunities. The Department shall 39
make an application for grants available to public school units prior to August 1 of each school 40
year. The application shall include at least one industry partner that the public school unit intends 41
to collaborate with to achieve the goals of the program enumerated in this section. Public school 42
units applying for grants shall submit their application to the Department by October 1 of each 43
school year. The Department shall make determinations on grant recipients by November 1 of 44
each school year and disburse grants funds within 60 days of making the determination. 45
46
PART IV. PROMOTE COM MUNITY COLLEGE ENROL LMENT WITHIN PUBLIC 47
SCHOOLS 48
SECTION 4. There is appropriated from the General Fund to the Department of 49
Public Instruction the sum of ten million dollars ($10,000,000) in recurring funds for the 50
2025-2026 fiscal year for the Department to collaborate with the Community Colleges System 51 General Assembly Of North Carolina Session 2025
House Bill 365-First Edition Page 5
Office to create an awareness campaign in public school units to promote enrollment in 1
community colleges. The campaign shall inform students and parents of career pathways, 2
internships, apprenticeships, dual enrollment opportunities, and certification pathways available 3
through the Community College System. 4
5
PART V. EFFECTIVE DATE 6
SECTION 5. This act becomes effective July 1, 2025. 7