Author: Steven Pennington
The 2025 County Development Tiers went into effect on January 1, with a relatively large number of counties shifting tier from 2024. In total, eighteen counties changed tier in 2025. This blog will review the Tiers and highlight this year’s changes.
Although seven counties impacted by Hurricane Helene shifted tiers in 2025, the time-lagged data used in the calculation means the hurricane’s effects aren’t well reflected in this year’s County Development Tiers. As detailed in Commerce’s annual tiers memo, the average annual county unemployment rate is the only factor among the four used in the tiers formula that captures any of Helene’s impacts. The hurricane’s influence is likely to shape future tier designations as more updated data becomes available.
2025 County Development Tiers
For 2025, counties moving to a less distressed tier include: Cherokee, Chowan, Duplin, Gates, Granville, Haywood, Jones, Onslow, and Pasquotank. Counties moving to a more distressed tier include Alexander, Caldwell, Camden, Cleveland, Davie, McDowell, Montgomery, Randolph, and Surry.
For details on each county’s change, see the latest county tiers memo.
More on County Tiers
Since 2007, North Carolina has used a three-level system for designating County Development Tiers. The designations, which are mandated by state law, determine a variety of state funding opportunities to assist in economic development. According to the formula laid out by the General Assembly, the 40 most distressed counties are designated as Tier 1, the next 40 as Tier 2 and the 20 least distressed as Tier 3.
County Tiers are calculated using four factors (including timelines for 2025 tiers):
- Average unemployment rate for the most recent twelve months for which data are available (November 2023 – October 2024, NC Dept. of Commerce, LAUS)
- Median household income for the most recent twelve months for which data are available (2022, U.S. Census, Small Area Income & Poverty Estimates)
- Percentage growth in population for the most recent 36 months for which data are available (July 2020 – July 2023, NC Office of State Budget & Management)
- Adjusted property tax base per capita for the most recent taxable year (FY 2024-25, NC Dept. of Public Instruction)
For additional insight and answers to common questions about the County Development Tiers, visit Commerce’s FAQ page. One key question it addresses is, “What programs are impacted by the County Development Tiers?”