High staff vacancies meant NC agencies left budgeted money unspent

Published August 9, 2023

By Lynn Bonner

North Carolina agencies left untouched more than $1 billion set aside for them, partly because of the state employee staff shortage, the state budget office said Monday. 

Appropriated funds that state agencies don’t spend are called “reversions.”  Reversions amounted to $1.17 billion, or 4%, for the state budget year that ended June 30.

The state staffing shortage was a factor in unusually high reversions, the Office of State Budget and Management said in a news release. About 20% of state jobs are vacant. 

Increased Medicaid payments coming to the state from the federal government for longer than expected during the COVID-19 public health emergency and reversions from the state Department of Public Instruction also contributed to the reversions total. 

In addition to across-the-board raises, proposed budgets the state House and Senate passed include money state agencies can use for targeted salary increases to recruit and retain employees.. 

State employees are still waiting to find out what their baseline raises are for this year. 

The budget is about five weeks late. Republican legislators have not yet agreed to a final spending plan. House Speaker Tim Moore said they have come to an agreement on employee and teacher raises, but did not disclose it, the News & Observer reported. 

House Republicans proposed 7.5% state employee raises over two years. Senate Republicans wanted 5% raises over two years. 

The State Employees Association of North Carolina is pushing for 10% raises over two years, bonuses to help with employee retention, and a 2% cost of living increase for state retirees. 

The state took in about $33.5 billion in the fiscal year that ended June 30, or about 10% more than legislators expected when they approved last year’s budget.