School Finance in North Carolina

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How are Public Schools Funded in North Carolina?

Under North Carolina’s school finance system, established nearly nine decades ago, it is the state’s responsibility to fund instructional expenses (including personnel) while county governments are responsible for the cost of capital expenses (buildings and maintenance). While the state bears responsibility for fulfilling its constitutional obligation of providing a sound basic education to every child, North Carolina schools have three sources of funding. In the 2019-20 school year, North Carolina public schools spent nearly $14.1 billion on instructional expenses, using a combination of state, federal, and local resources. State funding accounted for 67 percent of expenditures, federal funding accounted for 10 percent, and local funding accounted for 23 percent of spending.

The nearly century-old division of state and local responsibility for school funding still shapes the way North Carolina pays for public education today, with approximately 65 percent of instructional expenditures coming from the state and over 97 percent of capital expenses paid at the local level. However, this division has eroded somewhat in recent years. In 2019-2020, counties funded 17.7 percent of principal and assistant principal positions, 6.9 percent of teachers, 8.8 percent of teacher assistants, and 23 percent of professional instructional support personnel; and the state funded 2.5 percent of capital expenses.