Transportation (Transportation Funding)

SB 263 is a routine budget bill that allocates funding for North Carolina state agencies' operations during the 2025-2027 fiscal biennium. It provides appropriations from the General Fund, Highway Fund, Highway Trust Fund, and federal block grants (DHHS and NER) as required by existing budget law. The bill formalizes funding levels for ongoing state services without creating new programs or changing eligibility rules. It applies only to the 2025-2027 period and becomes effective July 1, 2025.

This bill authorizes local governments to borrow money through "grant anticipation notes" to accelerate local transportation projects already identified for funding under the State Transportation Improvement Program (STIP). To utilize this, a local government must enter into an expedited project agreement with the Department of Transportation (DOT), outlining project details, costs, funding, and a repayment plan. These notes are special obligations, meaning they are repaid solely from the anticipated STIP funding, and the local government's general taxing power is not pledged. The DOT must ensure that any STIP changes do not delay the repayment of these notes, and both the DOT and the Department of the Treasurer are directed to establish rules for their implementation.

HB 948, the P.A.V.E. Act, amends North Carolina law to allow Mecklenburg County to levy an additional 0.5% local sales tax specifically for public transportation systems. The bill defines "public transportation system" broadly to include buses, transit facilities, bike/pedestrian infrastructure, and automated transport tunnels, while excluding general roads. Funds collected must supplement, not replace, existing public transit funding and can only be used for financing, building, operating, or maintaining these systems. The tax proceeds would be distributed monthly to Mecklenburg County and its public transportation authorities per a financial plan, with the bill taking effect only if Mecklenburg levies this tax.

HB 837 is a study bill requiring North Carolina to examine alternative highway funding methods, primarily to address potential revenue gaps as electric/hybrid vehicle adoption grows. It directs the Legislative Services Officer and Transportation Oversight Committee to hire a consultant to study mileage-based fees (VMT) for electric/hybrid vehicles and a new "Access User Fee" for all non-diesel vehicles (replacing gas taxes). The study must be completed by May 2026, with findings reported to key legislative committees. This bill does not implement new fees but assesses options affecting all vehicle owners, particularly electric/hybrid drivers and non-diesel vehicle registrants. It allocates $125,000 from the Highway Fund for the study, effective July 1, 2025.

HB 752 establishes two new funds to support transportation infrastructure: a $50 million Rail Fund for railroad upgrades, connections, and equipment, and an Airport Fund for airport capital improvements and flight incentives. The Rail Fund prioritizes projects that boost economic growth, with 60% of annual allocations reserved for matching federal grants and 30% for planning. The Airport Fund limits 80% of funds to capital projects (like runway upgrades), 17% to attract strategic flights, and up to 20% to safety improvements. Both funds require competitive allocation based on projected job creation and economic impact, with annual reports to lawmakers. This bill directly affects rail operators, airports, and industries relying on transportation networks across North Carolina.