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State budget analysts have released an updated revenue forecast showing some great news for the state of North Carolina, stronger than expected collections. But lawmakers are cautioning that rising costs and future tax cuts could strain North Carolina's finances, which has been a long-standing debate between the North Carolina House and Senate as it relates to a budget and one of the large reasons why we have been without one since the start of the fiscal year, July the 1st of 2025. The Fiscal Research Division and the Office of State Budget and Management projected 35.5% $079 billion in general fund revenue for the fiscal year 25 to 26 and 34.72 billion for the fiscal year 26-27, with both of those numbers increasing over previous estimates. The revised forecast reflects an improving economic outlook and stronger tax collections, with economists at the state legislature's fiscal research division now expecting 6.7% growth in personal income in 25 through 26 and up 5.2% so far since May of 2025. Though February, personal income taxes, business taxes, and non-tax revenues were running ahead of projections, this is despite sales tax collections lagging slightly behind.
As a result, the updated forecasts, I should say, increase expected revenue by $370 million for the fiscal year, which again started July the 1st of last year. That's the 25-26 fiscal year, and a whopping $951 million, very close to a billion dollars for the fiscal year 26-27, which will start here July 1st of 2026. House Speaker Destin Hall, the Republican from Caldwell County, pointed to the surplus as evidence of long-term fiscal policy success, saying in a statement, quote, today's announcement of a surplus demonstrates the success of fiscal responsible policies enacted by our Republican majority over the last 15 years. Brian Balfour, the vice president of research at the John Locke Foundation, said that the continued pattern of higher than expected collections reflects a longer-term trend. With Balfour telling the Carolina Journal, this new revenue forecast represents a $370 million increase above the certified projections made last year.
Once again, actual revenue appears to be coming in hundreds of millions of dollars ahead of the projections used to formulate the state budget. Balfour added that the reoccurring surplus challenges earlier concerns about the fiscal impact of tax cuts across the state. Saying, quote, significant surpluses have become the norm over the past dozen years as government forecasters have consistently underestimated the positive impacts of tax cuts and defied the projections of revenue shortfalls made by opponents of those cuts.
However, Destin Hall cautioned that while the state expects additional revenue, rising spending pressures, particularly a projected Medicaid shortfall, could offset some of those gains. With Hall saying in the statement, unfortunately, this surplus revenue will be entirely consumed by a projected billion-dollar Medicaid rebase. This program must be reformed in order to preserve our ability to fund public safety, education and other priorities. We must protect North Carolina's hard-earned reputation for fiscal strength by passing a responsible budget sooner rather than later. In addition to immediate budgetary impacts, the updated forecast also influences the state's ongoing tax reduction.
Under current law, North Carolina uses what are called revenue triggers to automatically lower personal income tax rates when collections exceed certain thresholds. Based on these new projections, the state, if everything stays the same that it is right now, is expected to hit a second trigger in 2028, which would reduce the personal income tax to 2.99% across North Carolina. While Republican leaders have championed the tax cuts as a driver of economic growth, they also note that the triggers could increase the risk of future budget gaps if revenue growth slows. The statement from Destin Hall's office reads: Under the updated revenue forecast, the state is projected to hit a second revenue trigger in 2028, increasing the chances of a significant reoccurring deficit and underscoring the need for responsible budgeting. House Republicans say that they intend to continue the state's tax reform strategy, with the statement also going on to say, House Republicans support continuing North Carolina's successful tax reform model of gradual, thoughtful tax cuts, which have taken us from 7.5% as the top margin rate to now 3.99% over the last 15 years and created the best business climate in the country.
Despite the generally positive outlook, fiscal research flagged several risks that could affect the forecast to geopolitical tensions, including the ongoing U.S.-Iran conflict, which they note could impact and already has impacted energy prices and economic growth. Additionally, uncertainty surrounding April's income tax collection still could shift the current year revenue totals. The forecast sets the stage for budget negotiations in Raleigh, where lawmakers must balance continued tax reductions with rising spending obligations while maintaining the state's fiscal stability. For those that have been following the budget back and forth in Raleigh since last year, the main holdout and the main issue, or at least one of the main issues, that has had Republicans in the Senate and Republicans in the House not being able to get on the same page is exactly these tax revenues and these triggers that were set in state law. Senate Republicans want to continue forward with legislation that was previously passed that would continue to reduce the personal income tax rate in North Carolina, while more Republicans in the House are waving the flag there.
As we heard from House Speaker Destin Hall, that the state could potentially be putting itself in a deficit in years forward with some of these continued reduced taxes.
So this is likely to probably only strengthen the discussion and kind of cause both sides to dig their heels in just a little bit more on the issue. We will see when lawmakers make their way back to Raleigh coming up here in the month of April, just here in a couple of days when we'll flip over the calendar. We'll see what some of those conversations look like. We'll be keeping a close eye during the short session on these budget negotiations. We'll bring you the latest details right here on the Carolina Journal News Hour.
In some other statewide news this morning, looking at the business sector, the North Carolina-based company behind Fortnite. Unreal, Unreal Engine, and Epic Games, the major overall company Epic, is cutting more than a thousand jobs across the company amidst a decline in user engagement. A letter sent to employees this week on March the 24th from founder and CEO Tim Sweeney said that the cuts are due to a, quote, downturn in Fortnite engagement. With Sweeney writing in the letter, we're spending significantly more than we're making and we have to make major cuts to keep the company funded. He went on to say, some of the challenges we're facing are industry-wide challenges, slower growth, weaker spending, and tougher cost economies.
Currently, consoles selling less than last generation and games competing for time against others increasingly engaging forms of entertainment. According to the letter, the employee layoffs is accompanied by over $500 million worth of cost cutting in contracting, marketing, and closing some open roles in order to get the company in a more stable place. In the letter, Sweeney said that the layoffs are not related to artificial intelligence, while noting that Epic Games wants to have, quote, as many awesome developers developing great content as tech as possible. Sweeney said that the people affected by the layoffs will receive a severance package of at least four months of base pay and healthcare coverage with more depending on their tenure. Epic Games was founded back in 1991 by Sweeney and currently has its very large worldwide headquarters in Kerry.
That is just outside the Raleigh area, which they moved to in 1999. The company has dozens of offices worldwide and is known for creating the very popular first-person shooter, Fortnite, which has generated over $20 billion in gross revenue since its 2017 release, according to NGS Solutions. This is not the first major layoff that we've covered with Epic Games. The last one in September of 2023, at that point, there was about 830 jobs eliminated before the March 2026 layoff. Epic had around 5,000 employees.
That 1,000-person layoff equals, and doing the quick math on that, about 20% of the total company.
So some major changes coming there to Epic Games, the very popular game Fortnite, Unreal Engine, and many other properties. The Epic Game Store, they produce a lot of that work coming out of their office here in North Carolina. You can read some additional coverage of that. We've got the full letter from Tim Sweeney over on our website. Site this morning, CarolinaJournal.com.
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It's 5:21. Welcome back to the Carolina Journal News Hour. Charlotte's FM News Talk 107.9. WBT, a state board of elections meeting yesterday, certified the 2026 primary. In most cases, we'll get to those details.
Plus, an audit confirmed some of its accuracy at its meeting on Wednesday. The North Carolina State Board of Elections did officially certify election results for the 2026 primary elections that we saw back here just a couple of weeks ago, including the state Senate District 26 race between Senate leader Phil Berger, the Republican out of Rockingham County, and the Rockingham County Sheriff Sam Page, where Page went on to win by 23 votes. This excludes the United States Senate race and U.S. House of Representatives races in NC 136, as well as 10, 11, and 13 in 10 different counties. The state certification followed the 100 County Board of Election canvassing and certification.
Process that we have watched unfold over the last couple of weeks with the state board of elections director Sam Hayes telling the board that aside from delayed reporting from Halifax County that pushed statewide reporting back about one hour on election night, the primary election ran well pretty smoothly. Around one and a half million votes were cast in the contest, all of the contests across the state, which equated to a 19.7% turnout of the more than 7.6 million eligible registered voters across North Carolina. With Sam Hayes saying that the big story was that early voting was up 25% from the last midterm primary, which happened back in 2022 and was almost comparable to turnout on Election Day itself. Both he and the board said that the success was due in large part to the work of all those 100 county board of election directors, staffs, and poll workers that made the election. Possible.
The board discussed three types of audits that they use to assess accuracy in various elections across the state. The first is the voter history audit, which checks the number of voters to get to voter history, which means they checked in to vote at a voting site and the number of ballots actually cast. Those numbers are then compared to a check for any discrepancies with any significant issues, could signaling or point to some level of election fraud.
However, that was not the case. Adam Steele, the associate general counsel for the board, said that there were 44 counties whose voter history and sample ballot cast matched exactly, and 48 had minor differences of no more than three ballots. In total, no county had a difference of more than 10 ballots from their voter history, or just one ballot per county across the entire state. The second type is the sample audit, which is required by state law. Counties are assigned a few voting sites and their absentee ballots, in which they are gone through and reviewed by hand to see how many they compare to the machine count for the top-level contests, which this year was the United States Senate race.
Each county received 200 samples, and of those audited, just five showed differences of only one or two votes between the machine and hand counts, while the rest were completely identical, demonstrating accuracy. Of the certified and tested machines that are used, or tabulators, I should say, that are used to tabulate your ballot. The third audit is the voter eligibility audit, and that is the final audit that we'll be covering here this morning, in which he used an example of someone who votes early or by absentee who vote who may have been convicted of a felony or passes away, making their vote ineligible to have voted in that contest or for their votes to count. The state board runs a report and flags those types of voters for counties to review with a notice being sent to the voter giving them an opportunity to explain why they were eligible. According to Steele, he said that there were about 80 voters who had early absentee ballots that were subject to a challenge, and two-thirds to three-fourths of those ended up being taken out of the count, which he said showed how smooth the process went for elections across North Carolina.
Carolina.
However, he did note that there were 10 county board of elections that had provisional ballots of a total of 16 voters that were on the registration repair project list in the federal contests that were not counted. The registration repair project, which we've talked about a couple of times here on the Carolina Journal News Hour, collects identification numbers from registered voters who do not have a North Carolina driver's license ID number or Social Security number in the state's voter registration database, which are used for verification and are required by a federal law. Despite not affecting the outcome of any contests, the board directed those counties to count the votes of those voters in the federal contests within two weeks. The board will certify those contests at its April meeting, and it's why so many of the contests I mentioned at the beginning, including the United States Senate race and many congressional races, were not certified by the Board of Elections. At their meeting on Wednesday.
Additionally, Steele said about 130 voters need to be added back to the registration repair list. He said that they came off the list due to a quote: different kind of process that's being fixed to prevent this from happening again in the future. Voter uh voters' votes cannot be discounted and they will be notified that if they don't provide identification before the general election, they will be required to cast a provisional ballot. The final thing to come out of the State Board of Elections meeting yesterday, the board also decided to table any further action until next month's meeting regarding a letter sent by the Democratic National Committee, or the DNC, last fall alleging that North Carolina was in violation of certain provisions of the National Voter Registration Act. They claim that for the state board's failure to designate certain state-funded disability service offices as voter registration agencies at public universities, including those at the UNC system and at colleges within the North Carolina Community College campus system that are also that they claim also throughout the state of North Carolina.
Again, however, that discussion was tabled by the state board. They do have a meeting scheduled coming up here just a couple of weeks as we flip the calendar over into the month of April. We will get the certification for the United States Senate and those House races. We'll have all of that coming up here in just a couple of weeks. You can read more on that story this morning, recapping that state board meeting over on our website, CarolinaJournal.com.
Look for the headline: State Board Certifies 2026 Primary Audits Confirm Accuracy. It's 5:36. Welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk, 107.9 WBT. The Trump administration has canceled two large offshore wind farm electrical generation leases that were previously approved under the Joe Biden administration. Interior Secretary Doug Bergam made the announcement this week at a major energy conference in Houston, Texas.
Telling the group, the era of taxpayer-subsidized, unreliable, unaffordable, and unsecure energy is officially over, and the era of affordable, reliable, and secure energy is here to stay. In 2022, French energy company Total Energies secured two leases to develop major offshore wind farms off the coasts of New York and North Carolina. The Carolina Long Bay project was planned around 22 miles south of Baldhead Island, that is just off the coast of Brunswick County, and was expected to generate enough electricity to power more than 300,000 homes. John Sanders, the director of the Center for Food, Power, and Life at the John Locke Foundation, told the Carolina Journal, this is very good news for electricity customers in North Carolina. It also is welcome news for people who live on the coast, for coastal fishing and tourism, for endangered whales and sea turtles.
And for other marine animals and avian species, for mariners and for military training and operations. In August of last year, Duke Energy sent a letter to the North Carolina Utilities Commission stating that offshore wind energy production is not currently the most reliable, cost-effective energy source, and that the energy company would not be issuing any more requests for proposals to pursue these projects going forward. With Sanders telling the Carolina Journal, an independent evaluation provided to Duke Energy by an independent evaluator last summer showed that offshore wind facilities would not be cost-effective.
so Duke had to withdraw plans to develop them. This move should further protect North Carolinians from this expensive mistake of offshore wind development. Wind is an intermediate, weather reliant source of electricity, which among other things means it is unreliable and requires backup generation and storage. Governor Josh Stein took to social media slamming the Trump administration, accusing them of spending this, accusing them of spending a billion dollars worth of taxpayer money. With the governor posting on X this week, the Trump administration is spending nearly $1 billion in taxpayer money to pay off a company to stop investments in clean energy that we need.
This is a terrible deal for the people of North Carolina and our country. The Trump administration pushing back on that, noting that it is not paying, but it is reimbursing total energies for the amount spent on the various leases: $133 million for the Carolina Long Bay lease and $795 million for the Bright lease off of the coast of New York. Doug Bergham said in a press release, this agreement is yet another win for President Donald Trump's commitment to affordable and reliable energy for all Americans. Offshore wind is one of the most expensive, unreliable, environmentally disruptive, and subsidized dependent schemes ever forced onto the American ratepayer and taxpayer. The United States Department of the Interior, of which Bergham is the head of, reports that Total Energies will invest approximately $1 billion in oil, natural gas, and LNG production in the United States.
With the CEO of Total Energies justifying the move away from offshore wind, admitting that it doesn't currently align with the administration, he said, quote, considering that the development of offshore wind projects is not in the country's interest, we have decided to renounce offshore wind development in the United States in exchange for reimbursement. of the lease fees.
Furthermore, these agreements under which we will reinvest the refunded lease fees to finance the construction of an LNG plant and development of our oil and gas activities, it will allow us to support the development of U. S. gas production and exports. Here in North Carolina, Senate Bill 266. became law in twenty twenty five.
This was after the North Carolina General Assembly overrode Governor Josh Stein's veto, scrapping the state's seventy percent carbon reduction target by the year twenty thirty. Lawmakers say that the move could save residents up to $15 billion in future utility costs while helping meet rapidly rising power demand across North Carolina. The state still maintains a long-term goal of reducing carbon emissions 100% from the 2005 levels. That has to be done by 2050. Sanders said in his final comments to Carolina Journal: Especially given the recent increase in electrical demand, I am hopeful that our utilities will focus their efforts on obtaining power generation from proven, reliable resources like natural gas, nuclear, and even coal.
This was a major announcement this week from the Trump administration as Total Energies, the French company that had these leases, is set to reinvest this money into LNG, oil, and other sorts of forms of electrical generation in the United States. We'll have continued coverage of that over on our website, CarolinaJournal.com. In some other statewide news this morning, North Carolina's community colleges are enrolling more students than at a point since before the COVID-19 pandemic and growing at four times the national average. This is according to brand new data presented to the state board of community colleges earlier. this month.
Full-time equivalent enrollment has grown by 23% since the pandemic's low point in the fall of 2020. This growth stands out even more against national benchmarks. According to national student clearinghouse data, North Carolina Community College curriculum enrollment grew 12% since the fall of 2019, compared to just 3% growth across the nation.
So, North Carolina very much outpacing those national trends. A larger share of the state's post-secondary student population is also enrolled in community colleges. The same data set shows that 49% of North Carolina's curriculum undergraduates are enrolled at community colleges, compared to, once again, just 37% nationally. That growth is also outpacing the state's population explosion. With State Board of Community College member Gregory Lang raising the question of whether North Carolina's population increase could explain the enrollment surge, with fellow board member Scott Otman saying he checked the numbers in the prior evening, noting the population in North Carolina only grew by 7% in this same timeframe, roughly one-third the rate of the enrollment growth.
According to board member John Kane, he said, being number one in business and number one in workforce, we just need to keep being number one and keep getting better and comparing ourselves to others to make ourselves strive to be the best that we can be. This enthusiasm is contagious and we're excited about it continuing across North Carolina. The data also showed that enrollment gains were not confined to urban areas, but did include rural areas as well. According to the presentation, 53 of the system's 58 community colleges grew in the most recent year, with 14 of the 58 growing by more than 10%. Looking back further, among the 38 colleges that have grown since the 2018-2019 school year, seven of them saw full-time equivalent enrollment growth exceed more than 30%.
One, for example, James Sprunt Community College, a small rural institution, led all colleges with a whopping 83% growth over that period of time. According to Dale McGuinness, who is the Strategic Planning Committee Chair for the North Carolina Community College System, he told the board, what we're facing is not the enrollment cliff that we've been hearing about so much with the declining number of eighteen year olds. And what we're facing is a capacity ceiling because this growth is, well, not sustainable. The system also shifted to how it delivers instruction. Online and hybrid enrollment has surged since the pandemic, with just 23% of curriculum full-time equivalent students now in traditional in-person courses compared to nearly half before COVID-19.
Board members also noted workforce gaps. Despite record enrollment, the number of students completing credentialed in high-demand industries falls well short of what employer needs are across North Carolina. In trades and transportation alone, just over 9,000 students completed credentials in the 24-25 school year against more than the 71,000 average annual job openings according to data presented to the state board. With McGinnis telling the group, in every case but one, we don't have the graduates. We're not putting out the graduates to meet the needs of some of our employers.
Census data included in the presentation showed that more than 220,000 North Carolinians aged 25 to 44 lack a high school diploma or equivalent, and more than 840,000 have no diploma but post-secondary credentials. The community college system's top legislative priority for the 2026 legislative short session is a program called Propel NC. It is a proposal, it is a proposed new funding model that would align state appropriations with labor market demand. The proposal includes some $68.5 million in recurring funding to implement the new model, $24.5 million in recurring funds for base modernization, and $6 million in non-recurring fund for an enrollment growth reserve.
So, some great news across the North Carolina Community College System. You can read some additional details on that. We've got all the data, figures, and numbers over on our website, CarolinaJournal.com. Look for the story with the headline: North Carolina Community College Enrollment Surpasses Pre-Pandemic Levels. U Um Good morning again.
It's 5:53. Welcome back to the Carolina Journal News Hour, Charlotte's FM News Talk 107.9 FM, WBT. Earlier this week on National Agriculture Day, which was March 24th, Brooke Rollins, the secretary of the United States Department of Agriculture, announced the launch of a national campaign to bring awareness to what is known as Product of the USA, which is a new labeling standard for meat, poultry, and egg producers across the United States. Roland said in the press release: Our great patriot ranchers and producers grow, raise, and harvest the world's safest, most affordable, and abundant food supply. American consumers want to support America by buying American, and this label will strengthen our food supply chains through transparency, fairness, and trust.
This new standard policy ensures producers who invest in fully American supply chains can compete fairly, and it gives consumers the confidence that they deserve about the food that they bring home and put on the table. The product of the USA label became effective on January the 1st of this year and is exclusively for meat, poultry, and egg produce products born, raised, harvested, and processed in the United States. While this labeling is entirely voluntary, companies choosing to participate are required to meet this transparent and verifiable requirement according to details from the USDA. Cattle farmers across all 100 of North Carolina's counties generate more than $326 million in cash receipts annually. And as we have talked about many, many times here on the Carolina Journal NewsHour, the agricultural industry does remain the number one business in the state of North Carolina.
Kelly Lester, a policy analyst for the Center for Food, Power, and Life at the John Locke Foundation, told the Carolina Journal, a voluntary product of the USA label is not all the bad of the idea for a market-driven food system, giving farmers and producers the choice to adopt it when it adds real value. She went on to say, tightening the definition also addresses concerns around loopholes that allow some imported products to qualify after only minimal U.S. processing. But this requires every step of the supply chain to be domestic risks going forward, prioritizing patriotic branding over efficiency and potentially raising costs in the global market, where flexibility is key to keeping food affordable and safe. In October of 2025, Brooke Rowlands, the head of USDA, rolled out USDA's plans to fortify the American beef industry.
The initiative focused on rebuilding domestic capacity, increasing supply chain transparency, and ensuring that a level playing field was the case for all U.S. ranchers. Andrea Ashby, a spokesperson for the North Carolina Department of Agriculture and Consumer Services, told the Carolina Journal: We will be learning more about this new initiative in upcoming meetings with the USDA, but we are very supportive of truth and labeling that helps consumers know where their food actually comes from. This obviously was a major topic of conversation across the state of North Carolina. You can read some additional coverage over on our website, CarolinaJournal.com.
The headline Voluntary Product of USA label announced by USDA. Coming up tomorrow morning, right here on the Carolina Journal News Hour, we have got brand new polling out of the state of North Carolina as we'll dive into details in our March Carolina Journal poll, looking at a litany of contests across the state. Hopefully, you'll join us for that. That's going to do it for a Thursday edition. WBT News is next, followed by Good Morning BT.
We're back with you tomorrow morning, 5 to 6, right here on Charlotte's FM News Talk, 107.9, WBT.
