About half a dozen states have apologized for similar 20th century practices, called eugenics. But North Carolina is the first to move toward paying damages to the surviving victims.
The Legislature must still approve any payments.
The panel recommended Tuesday that the money go to living victims, including those who are alive now but may die before the lawmakers approve any compensation.
The state sterilized more than 7,600 people between 1929 and 1974. A task force report last year said 1,500 to 2,000 of those victims are still alive, and the state has verified 72 victims.