How Does Governor Cooper’s Budget Proposal Prioritize Early Childhood?

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Last month, Governor Cooper released a FY 2022-2023 budget proposal, called Building on Success, that includes investments in early childhood, education and health. In the plan, Cooper proposes a $525.8 million budget, designed to fully fund recommendations from the Leandro Comprehensive Remedial Plan and $89.7 million specifically to expand access to high quality early childhood education for children from birth to age five.

“Families experienced tremendous stress through the COVID-19 pandemic but have emerged to find that they still struggle accessing affordable health care, housing, and child care. This budget recommendation addresses those needs by expanding health care access to more than 600,000 working North Carolinians, making housing more affordable through down payment assistance and construction of additional rental housing, and investing in the early childhood educator workforce,” said Cooper in his accompanying letter. 

We’ve assessed highlights from the proposal below.

1. Empowering Safe, Successful Communities 

The Governor’s budget invests in safer, more prosperous communities. North Carolina experienced a 19% increase in children aged 15 and younger with charges for nonviolent firearm offenses between FY 2018-19-and FY 2020-21. The proposal:

  • Supports community-based solutions to help our youth thrive, with $20 million for the Department of Public Instruction for school safety grants to empower school districts to address students in crisis and provide school safety and mental health training. 
  • Helps community and health care organizations reduce violence in their communities with $5 million in grants for evidence-based interventions.
  • Distributes school safety grants to all 115 North Carolina public school districts.

2. Ensuring a Sound Basic Education for All Students 

The Governor’s budget provides resources and supports to help students catch up on learning and invests in educator pay to recruit and retain the best teachers. It provides $525.8 million to increase access to a sound, basic education for North Carolina’s children by fully-funding Year Three of the Comprehensive Remedial Plan, as well as studies called for in Year Two, but not funded in SL 2021-180

Of these funds, $33.1 million develops a skilled educator pipeline and builds educator and principal capacity; $370.1 million provides fair and equitable distribution of financial resources; $19.9 million supports low-performing schools and districts; $89.7 million expands access to high quality early childhood education for children from birth to age five; and $13 million creates a guided pathway from high school to postsecondary education and career opportunities. 

Early Childhood Learning Opportunities Items that impact birth through third grade, many of which align with our Pathways to Grade-Level Reading Action Framework, include:

  • Supports a high-talent educator workforce with more than $32.8 million dedicated to attracting, training, and developing quality educators, including additional funds targeted to low wealth and high needs districts and schools. 
  • Supports students’ education by providing $187 million for disadvantaged student supplemental funding and at-risk allotments, and by removing funding caps and increasing funding for children with disabilities and Limited English Proficiency students. 
  • Addresses out-of-school barriers to learning through adoption of a Community Schools model by investing $6 million for schools. 
  • Expands access to early childhood education by investing in the NC Pre-K program and high-quality child care. 
  • Raises the average pay for early childhood educators by providing $26 million for the NC Child Care WAGE$ program and funds a statewide floor rate in the child care subsidy program, which will help increase the availability of high-quality child care in rural and lower wealth counties and recruit and retain child care workers. 
  • Strengthens early intervention services with $10.3 million and provides $10 million for Smart Start
  • Establishes the Community Colleges Early Childhood Education Centers Pilot to provide grant funds for community colleges to host early childhood education centers. 
  • Increases the pipeline of diverse, well-prepared teachers by investing $4.7 million to expand Teaching Fellows eligibility to include any State Board of Education-approved educator preparation programs, broaden eligible certification areas, extend the reduced payback period to Fellows who teach in high-poverty schools, improve opportunities for talented minority candidates, and expand program support and enhancement.
  • Supports children experiencing food insecurity and improves their learning experience by investing $3.9 million to offset the co-pays for students eligible for reduced price lunches in schools participating in the National School Lunch Program

Expected North Carolina Early Childhood Impact

The proposed investment key impacts for early childhood are expected to: 

  • Increase NC Pre-K reimbursement rates by 19%, and administrative reimbursement rates from 6% to 10%. 
  • Expand Smart Start services statewide and strengthen the Early Intervention program with increased staffing and professional development.
  • Expand the Child Care WAGE$ program statewide to improve pay for early childhood educators.

3. Expanding North Carolina’s Workforce

North Carolina is recruiting new jobs at a record pace. The proposed budget continues to invest in our workforce to meet the needs of employers. It provides over $120 million to address North Carolina’s labor shortage, with an emphasis on supporting priority populations, investing in successful workforce development programs and pilots, recruiting and retaining early childhood educators so parents can stay in the workforce, and increasing the number of healthcare workers statewide.

  • North Carolina’s 2021 women’s labor force participation rate remains 1.9% below its pre pandemic high in 2019, and child care issues were cited by almost half of workers with children younger than 18 as a reason for leaving a job, according to a 2021 Pew survey.
  • According to the NC Business Pulse Survey, 65% of employers had concerns about adequate staffing levels at their business in March 2022.

Tackling these issues will help North Carolinians return to work and secure good-paying jobs and ensure employers can find the skilled workers they need to succeed. 


Recommendations address the major issues facing education and the state workforce: loss in recruiting power, a competitive marketplace for labor, and employee retention. These proposals will support the state’s workforce by offering targeted increases in compensation. Expected impacts include increased retention of experienced educators by investing in veteran educator salaries and removing plateaus in the educator salary schedule. 

Table 1: Compensation Funds

  • Educator and Assistant Principal Compensation Increase: Adjusts the Teachers Salary Schedule to ensure all educators receive at least a 7.5% increase over the biennium, on par with state employees. Salary increases include state agency teachers who are paid in accordance with the statewide teacher salary schedule. In addition, the proposed teacher salary schedule minimizes plateaus for veteran teachers and increases starting pay to $36,600. Assistant principal compensation is tied to the teacher salary schedule, thus their salaries increase accordingly. The recommended FY 2022-23 salary schedule is provided in Table 2. 
  • Educator Master’s Pay: Provides $9 million to reinstate Master’s pay for educators who have or obtain a relevant Master’s degree.

Table 2: Annual Statewide Teacher Salary Schedule Comparison

Living Wage

Increasing wages for all North Carolinians is vital to the state’s economic growth, as well as quality of life for residents. The Governor’s Budget includes recommendations aimed at increasing wages for essential caretakers, including those who work in the early childhood educator workforce. Funds will help increase wages for those making less than a living wage and support quality care for young children. 

During the COVID-19 pandemic, the country has gone through a child care workforce crisis:

  • Nationally, child care providers made an average of $13.22 per hour in 2021, while the median wage for all workers was $22 per hour. 
  • In North Carolina, a starting assistant teacher, in a child care facility, made an average of $10 per hour in 2019. 
  • In North Carolina, employment in child care centers fell by 3,276 between February 2020 and February 2022, a decline of 8.7%.

Recommended additional support for NC Child Care WAGE$ Program: Provides educational attainment-based salary supplements for early childhood educators, to better attract and retain highly qualified staff, who are essential to early childhood programs. These funds will allow this successful program to expand statewide to provide wage supplements to early childhood teachers in all 100 counties. 

Workforce Development

To support workforce development, the Governor’s proposal addresses the child care subsidy rate floor and increased supply of child care for working parents: Includes $18.5 million recurring to provide a statewide rate floor in the child care subsidy program for child care centers and family child care homes in lower wealth counties. In addition, $26 million is invested in the NC Child Care WAGE$ program to ensure the program is available statewide and raises average pay, helping attract early childhood educators, minimize turnover, and increase continuity of care in the classroom. 

Lastly, this package invests $10 million nonrecurring to develop or assess the feasibility of expanding early childhood development centers (CDCs) on community college campuses and to enhance existing campus-based CDCs. Community colleges based CDCs will increase professional development opportunities for the child care workforce, while also providing additional child care options to support students completing their degree programs.

This proposal will aid the state’s new and existing businesses by equipping North Carolinians for high quality, well-paid jobs, and provide the support needed for a labor pool that includes parents and seasoned workers. Expected impacts include:

  • Enhanced services to an additional 10,800 jobseekers each year through expansion of services for priority populations. 
  • Decreased turnover of the child care workforce by up to 9%. Statewide Early Childhood Education turnover in 2019 was 21% compared to WAGE$ participants’ rate of 12%. 

4. Expanding Medicaid

The Governor’s budget proposes Medicaid Expansion to provide access to affordable health insurance to more than 600,000 additional North Carolinians, including veterans, working people without insurance, families with children, and others. Medicaid expansion would provide coverage for working people and help strained healthcare providers recover from the pandemic, particularly in rural communities. Expanding Medicaid ensures access to affordable health insurance, increases access to health care, and bolsters rural hospitals. 

  • In 2019, 11.3% of North Carolinians lacked health insurance, representing over 1.1 million residents. Nationally, the uninsured rate in 2019 was 9.2%. North Carolina ranked 41st in uninsured rate in 2019.
  • Today, parents with children who earn less than 42% of the federal poverty line are eligible for Medicaid coverage; for a family of four, this amounts to $11,655. Medicaid expansion would raise that amount to $38,295, providing coverage to individuals and parents with children who earn less than 138% of the poverty line.