Senate Bill 126 would require North Carolina executive branch agencies to prepare zero-based budget plans on a rotating schedule beginning with the 2025 fiscal year. Under zero-based budgeting, agencies would justify funding from a zero-dollar starting point rather than relying on prior appropriations, and each plan would need to describe agency activities, legal authority, expected impacts if activities were discontinued, measurable outcomes, and the funding needed to maintain minimum and current service levels. The Office of State Budget and Management (OSBM) would provide technical assistance and would compile and submit the plans to the General Assembly alongside the Governor’s budget recommendations.
The bill phases in the requirement over several biennia, starting in 2025 with selected divisions within the Department of Health and Human Services, then expanding in 2027, 2029, and 2031 to additional agencies across state government. Statutory appropriations are excluded from the zero-based budgeting requirement. The measure is effective upon becoming law.
Impact
The bill would amend Chapter 143C of the General Statutes by adding a new section requiring recurring zero-based budget submissions for specified state agencies. It would change the budget process for those agencies by imposing detailed justification and performance-reporting requirements and by directing OSBM to review and transmit the plans to the legislature. The practical effect would be to increase administrative workload for affected agencies and OSBM while giving lawmakers a more granular basis for evaluating agency funding requests.
Sentiment
Based on the bill text and the absence of recorded committee debate or votes in the provided materials, the overall sentiment appears procedural and reform-oriented rather than overtly partisan. The bill is framed as a government efficiency and accountability measure, suggesting support for tighter scrutiny of spending and program performance. No opposition, amendments, or recorded roll-call concerns are available in the provided context.
Contention
The main potential point of contention is the burden zero-based budgeting may place on agencies, especially because it requires detailed activity-by-activity justification, outcome measures, and service-level analyses. Agencies with broad or complex missions may view the process as time-consuming and resource-intensive, while supporters are likely to emphasize fiscal discipline, transparency, and the ability to identify low-value spending. Another possible issue is the phased schedule, which prioritizes some agencies years before others and excludes statutory appropriations, potentially limiting the bill’s reach.