By: Jordan Meadows
Staff Writer
North Carolina’s public schools are facing renewed scrutiny after the Education Law Center released its annual Making the Grade report, which gave the state an overall F for school funding.
The report evaluates states based on funding level, funding distribution, and funding effort, and North Carolina failed two of the three categories.
The most damaging mark for North Carolina was its ranking in funding effort, which measures how much of a state’s economic capacity is invested in public education. The state ranked dead last, investing just 2% of its gross domestic product into education, compared with a national average of 3.1%. As a result, North Carolina spends about $12,193 per student, compared to the top state of Vermont at around $27,000.
North Carolina received a slightly better grade in funding distribution, earning a C for providing marginally more funding to high-poverty districts than to low-poverty ones. The state provides about $600 more per student in higher-poverty areas, placing it on the lower end of “progressive” funding states. North Carolina is one of 13 states to receive failing grades in both funding level and funding effort.
The state’s low ranking reflects a long-standing trend: from 2002 to 2023, North Carolina’s per-student funding grew by just 8.5%, ranking 48th in the nation. While funding growth from 2020 to 2023 ranked 17th nationally at 8.7%, the report attributes most of that increase to temporary federal COVID-19 relief dollars. With those funds now expired, the Education Law Center warns that public school funding growth may be slowing nationwide due to rising economic uncertainty, declining enrollment, and increased competition from private schools, vouchers, and homeschooling.
In the 2022–2023 school year, the state spent between $5,000 and $6,000 less per student than the national average, ranking 49th in funding level, just above Idaho. Neighboring states performed significantly better, with South Carolina ranking 10th in funding effort and Virginia and Georgia also receiving higher overall grades.
Low funding has directly affected educators. North Carolina ranks 43rd in the nation for average public school teacher pay, with an average salary of about $58,292. At a December 2025 meeting of the North Carolina State Board of Education, members discussed legislative priorities ahead of the 2026 short session, focusing heavily on teacher and staff pay. Geoff Coltrane, senior director of government affairs at the Department of Public Instruction, warned board members to expect very limited revenue and said lawmakers may not even pass a full budget for the 2026–2027 fiscal year, urging the board to narrow its requests to essential items.
Educators say the pay gap has real consequences. Rachel Candaso, the 2025 North Carolina Teacher of the Year, said she worked two additional jobs during the 2023–24 school year to supplement her income. Jason Johnson, the 2025 Principal of the Year, said some of his teachers work night shifts at retailers such as Walmart, Costco, and Old Navy. Although Governor Josh Stein proposed a 10.6% raise for teachers and a 6% raise for principals in his 2025–26 budget, and legislative proposals ranged from 2.3% to 8.7% for teachers, the General Assembly adjourned in late July without passing a two-year budget.
Beyond salaries, North Carolina schools face major infrastructure challenges, with an estimated $13 billion needed for repairs and renovations. Many school buildings lack reliable heating, air conditioning, and other basic features necessary for modern, 21st-century learning. Rising benefit costs also strain school budgets. From 2002 to 2023, spending per student on employee benefits such as pensions and health insurance nearly doubled, growing by 98.9% and ranking the state 13th in the nation for benefit spending per student. Teacher pension debt has been identified as a primary driver of these rising costs.
Staffing patterns have shifted as well. Nationally, public school staffing grew by 15.1% from 2002 to 2023, with most growth coming from non-teaching positions such as counselors, social workers, and instructional aides. Teacher hiring grew by just 7.6% during that period. North Carolina had the 12th highest number of non-teaching staff in public schools in 2023, even as student enrollment continues to decline, a trend that the National Center for Education Statistics estimates will result in a 5.3% drop in enrollment between 2024 and 2032.
Underlying many of these funding issues is the decades-old Leandro case, filed in 1994 by low-wealth school districts arguing that North Carolina failed to provide students with a sound basic education. While there was progress in 2022, when a plan called for the release of $5 billion in funding for schools, legislative challenges have paused much of that money. The state Supreme Court heard arguments again in February 2024, but the case remains largely stalled.
