NC House approves $450 million more for Hurricane Helene relief aid

Nearly half a billion dollars more in relief funding for Hurricane Helene recovery won unanimous approval in the North Carolina House of Representatives Thursday, shortly after the chamber also voted to approve a separate $33 billion plan to fund the rest of state government.

The broader budget is expected to be bogged down in fights between Republicans in the Senate and House over tax policy and other disagreements. So House lawmakers are hoping to keep Helene aid separate, to help avoid it being delayed for potentially months amid the broader political debate over the budget.

But there could still be fights brewing over the Helene aid funding, too. The House plan is $450 million. That’s only half the $900 million Democratic Gov. Josh Stein said last week is needed. And in the middle is the state Senate, which has suggested spending $700 million.

The state has already approved about $1.6 billion in Helene aid. So while there’s disagreement over how much more to spend, all state leaders agree that they should be spending at least several hundred million more.

“We really really need it,” said Rep. Lindsay Prather, D-Buncombe. “I am looking forward to going home to Candler and telling people what we’re doing in Raleigh. Especially the small business grants.”

The House plan contains $60 million for small business grants. It also has $20 million for making roads, bridges and other parts of the local infrastructure more resilient, aimed at making sure future storms aren’t as damaging.

Rep. Mark Pless, R-Haywood, said that while Helene was the worst storm of his life he remembers bad flooding in 2004 and the 1970s, too, and that it would be foolish to expect another storm won’t hit the western part of the state in the future. “Without some form of resilience and mitigation, we’re going to repeat this the next time this comes to western North Carolina,” Pless said.

The unanimous support for the House plan, however, underlies the potential political fights ahead over this next round of Helene aid. In addition to the disagreement over how much money to spend, state leaders also have some disagreements over exactly what to spend it on. Stein has spent months asking for small business grants to help keep local businesses afloat. GOP leaders in the state legislature have previously resisted that, citing lingering unhappiness about pandemic-era business grants and alleged fraud in the program. But the House budget plan contains funding for those grants, with guardrails leaders say are intended to stop fraud. It remains to be seen, however, if the Senate can be similarly convinced.

“Folks have started talking about a way to measure who should get those grants,” House Speaker Destin Hall told reporters Wednesday, about why his caucus had come around to the idea. “The concern was, like in the PPP program during Covid, there was just either a lot of fraud or a lot of folks getting those funds who really didn’t need it. … We want to make sure that if we’re going to send those dollars to a private business, try to make them whole, that we’re actually sending it to a business that actually did have a loss.”

There’s also the broader question of whether to pass the bill as a standalone piece of legislation or as part of the broader state budget. The Senate has proposed combining Helene aid with the budget, unlike the House. Rep. Jake Johnson, R-Polk, said keeping Helene aid separate from the upcoming budget negotiations is the right thing to do. The broader budget negotiations are expected to deeply divide Republicans in the House versus Republicans in the Senate and drag on for months.

“I think its terrible optics to wrap this relief, that needs to get out the door, with the big budget,” said Johnson, noting that Lake Lure in his district has been waiting for months for action from the federal government and would benefit from quicker action by the state government.

However, as Republicans also work to pass further tax cuts, it also could remain unclear how much money the state will have to spend on Helene until after the budget debate is done. The Senate wants bigger tax cuts and smaller raises for teachers and other state workers, in its budget plan. The House proposes bigger raises and smaller tax cuts.

Stein, meanwhile, has proposed growing state revenue by freezing planned cuts to the corporate income tax rate, which Republicans currently plan to drop to 0% by 2030. His suggestion to keep requiring businesses to pay some taxes, however, has not been received well by the Republican-led legislature.

Stein has said the state needs to ramp up its own Helene aid because of what Stein said has so far been a slow and under-funded effort by the federal government, led by Congressional Republicans and Republican President Donald Trump.

“Federal disaster funding also continues to trickle into the state, although nothing close to the additional $19 billion I requested in February,” Stein wrote in a letter to state lawmakers last week. “I will continue to advocate for western North Carolina to our federal partners. However, we suspect the burden will fall increasingly on state and local organizations.”

Helene did $60 billion in damage to western North Carolina. No matter what the state and federal governments end up spending, it’s highly unlikely to cover even half that amount. However many nonprofits have also been active on the ground helping clear roads, rebuild houses and more. And the House budget plan approved Thursday would also steer $20 million to those nonprofits groups.

“We feel like any dollar we can put into those organizations is probably going to be worth $10 at the end of the recovery,” Rep. Dudley Greene, R-McDowell, said during debate over the House plan Thursday.