GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 883
Short Title: Support Students with Disabilities Act. (Public)
Sponsors: Representatives Balkcom, Cotham, Biggs, and Arp (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Education - K-12, if favorable, Appropriations, if favorable, Rules, Calendar, and
Operations of the House
April 10, 2025
*H883 -v-1*
A BILL TO BE ENTITLED 1
AN ACT TO ESTABLISH A PROGRAM FOR LOCAL SCHOOL ADMINISTRATIV E 2
UNITS TO APPLY TO TH E DEPARTMENT OF PUBL IC INSTRUCTION FOR 3
ONGOING EXTRAORDINAR Y COSTS OF CHILDREN WITH DISABILITIES, 4
INCLUDING FOR PLACEM ENT OF STUDENTS IN S ETTINGS OUTSIDE THE 5
SCHOOL SYSTEM TO REDUCE THE USE OF MODIFIED DAY, HOMEBOUND, AND 6
HOSPITALIZED PLACEME NTS, AND TO REQUIRE AN ANNUAL REPORT ON THE 7
MONITORING OF STUDEN TS IN HOMEBOUND, MOD IFIED DAY, AND HOSPITAL 8
PLACEMENTS. 9
The General Assembly of North Carolina enacts: 10
SECTION 1.(a) Program Established. – Beginning with the 2025-2026 fiscal year, 11
the Department of Public Instruction shall establish a grant program for local school 12
administrative units to apply for funds from the Special State Reserve Fund (SSRF) for children 13
with disabilities for the purpose of covering the extraordinary costs of certain students with 14
disabilities, including costs associated with the placement of students in private schools with 15
approved nonpublic education programs providing special education in accordance with a 16
student's individualized education program (IEP). The grant program shall provide funds for 17
students with disabilities on an ongoing basis according to the students' IEPs. The grant program 18
established by this act shall be administered separately from the grant program funded from the 19
SSRF available to local school administrative units for high costs related to emergency situations 20
for children with disabilities in a school year. Funds administered pursuant to this act shall 21
supplement and not supplant existing federal, State, and local funding for children with 22
disabilities. 23
SECTION 1.(b) Applications. – A local school administrative unit may apply for 24
grant funds for a student with disabilities served by the unit for extraordinary costs associated 25
with services provided to the student, including for a placement in a private school that has an 26
approved nonpublic education program providing special education in accordance with a 27
student's IEP. To be eligible for a grant, the local school administrative unit must demonstrate 28
that the total cost of the services equals or exceeds four times the State average per pupil 29
expenditure for children with disabilities in the prior fiscal year. The local school administrative 30
unit shall provide documentation to the Department of Public Instruction to support the funding 31
request. The student's IEP must support the determination of the services, including if the 32
placement of the student is at a private school. Grant funds shall be student-specific and follow 33
the student for special education and related services provided within the State. The Department 34 General Assembly Of North Carolina Session 2025
Page 2 House Bill 883-First Edition
shall require documentation for renewal of the grant for each school year with a request for funds 1
for the student. The Department shall reimburse seventy-five percent (75%) of the extraordinary 2
costs and disburse funds in quarterly amounts to providers on an approved list from the 3
Department. 4
For the purposes of this act, extraordinary costs shall only include costs directly 5
attributable to providing the special education services on the student's IEP, such as salary of 6
educational personnel; salary of related services personnel; costs for specialized books, materials, 7
or equipment; tuition costs; and consultant costs, if directly attributable to the student's 8
instructional program. Extraordinary costs shall not include administrative or overhead costs, the 9
costs of adapting classrooms or materials that are used by more than one student, nor the costs 10
associated with evaluation, development of the IEP, or service coordination for the student with 11
disabilities. 12
SECTION 1.(c) Oversight. – The Department of Public Instruction shall ensure that, 13
if a student who is covered by grant funds is placed in a private school that has an approved 14
nonpublic education program providing special education in accordance with a student's IEP, the 15
school is approved by the Department as adhering to State and federal laws governing education 16
services for students with disabilities and State and federal laws governing seclusion and restraint 17
of students. The student's local school administrative unit shall remain legally responsible for 18
ensuring the student is receiving a free appropriate public education in the least restrictive 19
environment while the student is placed in the private school, as required by State and federal 20
laws governing education services for students with disabilities, and the unit shall conduct an 21
annual review of the student's IEP and any interim reviews requested by the student's parent or 22
legal guardian for purposes of educational decision making in accordance with federal and State 23
laws. Prior to approving a renewal of the grant for a particular student, the Department shall 24
ensure that the annual review of the student's IEP has been completed and the student's parent or 25
legal guardian, for purposes of educational decision making, has received the notice of procedural 26
safeguards required by State and federal laws governing education services for students with 27
disabilities. 28
SECTION 1.(d) Appropriation. – There is appropriated from the General Fund to 29
the Special State Reserve Fund the sum of one million dollars ($1,000,000) in recurring funds 30
for the 2025-2026 fiscal year for the Department of Public Instruction to implement the grant 31
program established pursuant to this section. 32
SECTION 1.(e) Report. – By March 15, 2026, the Department of Public Instruction 33
shall report to the Joint Legislative Education Oversight Committee the number of grant 34
applications for the 2025-2026 school year, the amount of grant funds awarded, the types of 35
out-of-school system placements and service providers, and the type of extraordinary costs 36
reimbursed. 37
SECTION 2.(a) G.S. 115C-107.5 reads as rewritten: 38
"§ 115C-107.5. Annual reports. 39
The State Board shall report no later than October 15 of each year to the Joint Legislative 40
Education Oversight Committee on the implementation of this Article and the educational 41
performance of children with disabilities. The report may be filed electronically. Each annual 42
report shall include the following information: 43
… 44
(4) A summary analysis of the following data to be monitored and collected by 45
the Department of Public Instruction on students with disabilities in each local 46
school administrative unit on a monthly basis: 47
a. The number of new and continued homebound placements. 48
b. The number of new and continued modified day placements. 49
c. The number of new and continued Home/Hospital, Separate Schools, 50
and Residential placements. 51 General Assembly Of North Carolina Session 2025
House Bill 883-First Edition Page 3
d. The number of new and continued psychiatric residential treatment 1
facility placements." 2
SECTION 2.(b) The State Board of Education shall submit the report required under 3
G.S. 115C-107.5(4), as enacted by this act, beginning October 15, 2026. 4
SECTION 3. This act becomes effective July 1, 2025. 5