RALEIGH — The budget impasse in the North Carolina General Assembly between the Republican-controlled Senate and House has continued into 2026, with the issue of funding for the proposed N.C. Children’s Hospital resurfacing this week.
Specifically, at issue between the two chambers is releasing the final third year obligation of $103.5 million for the N.C. Children’s Hospital, as well as disagreements about health care-related “mini-budgets” amid broader state budget negotiations that stalled in mid-2025.
In 2023, both chambers approved nearly $320 million over three fiscal years for the project.
The Senate also passed a mini-budget in September 2025 called the Healthcare Investment Act (House Bill 562), which increased Medicaid rebase funding but also included $51.8 million for N.C. Children’s Hospital. The House did not take up the measure. A subsequent October 2025 press release from the office of Senate Leader Phil Berger (R-Eden) noted the hospital funding “is not new money and was included in the 2023 budget agreement.”
Citing Berger’s spokeswoman, Lauren Horsch, Business North Carolina had reported that Senate budget negotiators are “not asking for any new money” beyond the $103.5 million for N.C. Children’s Hospital.
Business NC’s report said the Senate had previously sought an additional $638.5 million but cited Horsch as saying, “Senate budget writers have moved” away from their previous position.
However, Horsch clarified her remarks to North State Journal.
“The Senate believes the previously approved commitments for N.C. Children’s and N.C. Care should be upheld. The funding for N.C. Care supports vital rural healthcare initiatives,” Horsch said in an email. “That is why as negotiations for the healthcare mini-budgets have progressed, budget writers have been pushing for the final tranche of funding — $103.5 million for N.C. Children’s and $105 million for N.C. Care — to be released.
“The Senate has made multiple offers to release those funds, but the House has thus far been unwilling to accept our offers. Additional funding for N.C. Children’s beyond the previously approved amounts would be part of a broader budget negotiation.”
North State Journal reached out to the office of House Speaker Rep. Destin Hall (R-Granite Falls), which indicated the House was open to the Senate speaking directly to them.
“Considering the many healthcare needs across the state, House members continue to have serious concerns with the necessity and wisdom of this project,” Hall’s spokeswoman Demi Dowdy told North State Journal. “We remain open to engaging with the Senate to reach a responsible budget.”
Hall and the House budget writers have stood firm on the need to update the economic trigger schedule currently in place for further tax reductions in the state, citing possible future budget deficits if no corrections are made.
General Assembly’s Fiscal Research Division and the Office of State Budget and Management have both issued predictions of revenue drops leading to deficits starting in fiscal year 2027 if the state stays on the current trigger schedule.
Gov. Josh Stein has concurred with House and the fiscal assessments, warning of a possible “fiscal cliff.” Stein’s also remarked that on the current reduction scheduled the state would see $2.3 billion dollars less in the next two years.
The proposed N.C. Children’s Hospital is being built through a partnership between UNC Health and Duke Health. The facility, which would be located in Apex, would be the state’s first freestanding children’s hospital in southern Wake County.
Groundbreaking for the hospital project is tentatively set for 2027 and construction is expected to take years.
The hospital will be part of a massive mixed-use area called Veridea, which will encompass retail, commercial, residential and a proposed Wake Tech Community College expansion site. Clearing and construction is underway for the Veridea complex, located in Apex between Highways 55 and 1, as well as the I-540 Raleigh outer beltline.
