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How will North Carolina use $5.7 billion in federal funds? A breakdown of the budget proposal

The state will get $5.7 billion in federal funds through the American Rescue Plan.

RALEIGH, N.C. — North Carolina Governor Roy Cooper shared his budget recommendations for how the state can invest in recovery through the American Rescue Plan (ARP).

The state will get $5.7 billion in federal funds in what the governor called a “once-in-a-generation opportunity” to invest in the state and in the recovery of the coronavirus pandemic.

"North Carolina’s funding from the American Rescue Plan positions our state for a shared recovery and allows us to create a North Carolina that works for all,” Gov. Cooper said.

Here’s a closer look at the breakdown of the budget:

Sound Basic Public Education

$300 million to build the educator pipeline, expand NC Pre-K, support high-quality child care, and promote early literacy development. It will also expand NC Pre-K and invest in home-based early childhood literacy interventions.

Extra Credit Grants 2.0

$250 million in grants to low-and middle-income families with children to help alleviate widespread financial hardship across the state. The state will give grants of $250 or $500 to eligible families, with lower-income families eligible for the higher amount.

Digital Divide

$1.2 billion in broadband access to close the digital divide in the state. The money will provide access to affordable, high-speed internet in every corner of the state.


$350 million in the North Carolina Guarantee Scholarship. It allows students from families making $60,000 a year or less to be guaranteed at least $6,000 per year to cover attending a North Carolina college.

Water and Wastewater Infrastructure 

$800 million to fix the state’s water and wastewater systems to provide clean drinking water and reduce water pollution. The state reveals more than 100 communities in the state have aging water systems they can’t afford to fix.

$440 million for water, sewer, and stormwater projects for distressed and at-risk water and wastewater units and $360 million is available for all units statewide.

Reconnect the Workforce

$25 million to help people who are disconnected from the workforce and increase their access to education, training and support needed to obtain work. The money will also support a reentry program partnership with the Department of Public Safety and a program aiding veterans and their families.

Housing Needs

$575 million to address the state’s housing needs made worse by the COVID-19 pandemic. It will aim to increase housing affordability and availability. It will include down payment assistance to first-time homebuyers and enhanced assistance for eligible public-school teachers.

Hospitality Industry Business Assistance and Recovery Grants

$350 million to promote economic recovery to the hardest-hit industries statewide. The money will help two programs for restaurants and other food services, hotels, recreation and leisure and personal services businesses.

Democratic Pricey Harrison represents North Carolina House District 61 in Guilford County. She agrees with the Governor's recommendations but said it remains to be seen whether Republican lawmakers will too.

"It’s not clear what the road ahead is, whether the Republican leadership agrees with the governor’s priorities," Representative Harrison said, "But I’m sure there are areas of congruence and areas of disagreement."

North Carolina House District 59 Representative, Republican Jon Hardister said he agrees with many of the Governor's proposals too.

"There was nothing I saw in that release that really stood out to me as being problematic," Representative Hardister said.

Both representatives said that on COVID-19 relief spending, both parties have been able to find common ground during the last year and a half.

"The Governor's recommendations is pretty similar to what we’re doing in the General Assembly and what the two parties agree upon," Rep. Hardister said, "I think there’s a really good chance that once the legislature passes the bill that allocates all this money, that the governor will sign it and we'll have an agreement."

The U.S. Treasury dictates what the funds can be spent on and when. Rep. Harrison said the state has until December 31, 2024 to come up with a plan but she thinks it will happen much sooner.