Charlotte property owners could pay more in taxes and fees for city services under the proposed budget presented to the City Council Monday.
City Manager Marcus Jones’ $4.2 billion proposal for fiscal year 2025, which starts July 1, calls for a 1.5-cent property tax increase. That would cost the “typical homeowner” an additional $1 a week, Jones said. He’s also asking for a total of $400 million in the form of bond referendums on the 2024 ballot to pay for a range of projects, including affordable housing and transportation.
Money from the higher taxes would go toward public safety, capital investments and the arts, Jones proposes. Although it’s officially the city’s first property tax increase in six years, it’ll add to higher taxes already being paid this year. While the city adopted a “revenue neutral” rate for the current fiscal year, many still paid more in property taxes in 2024 due to revaluation.
Jones warned last budget cycle a tax hike was likely in the city’s future, and on Monday he told reporters that time had come in order to keep up with the city’s needs and growth.
“Last year as we ended the budget, it was clear to me that we had to do something different coming into FY25,” he said. “… We were at this inflection point.”
The 2025 budget proposal also includes fee increases for solid waste, water and storm water services — which people could pay regardless of whether they own their home or apartment — and a bigger price tag for a regular city bond referendum.
Proposed tax, fee hikes
Charlotte’s current tax rate is the lowest out of North Carolina’s 12 most populous cities at the start of 2024, Jones said.
The city adopted a revenue neutral 26.04 cents per $100 in valuation rate for fiscal year 2024, but city budget director Ryan Bergman acknowledged at the time that about 90% of Charlotte homeowners would still pay more in property taxes after revaluation because of the rise in property values in the area.
About nine-tenths of the new tax money would go into the city’s general fund to help pay for public safety needs that Jones didn’t individually mention. An additional $11 million would go into arts funding, and another $11 million would help pay for “capital investments,” including housing and transportation.
Asked whether the proposed tax increase would eliminate the need for more hikes in years to come, Jones said that, while he’s “not forecasting more property tax increases,” it would be hard to pay for all of Charlotte’s transportation needs if the city can’t get a sales tax increase on the ballot. That requires help from the N.C. General Assembly.
“We will continue to need a revenue source,” Jones said of transportation.
In addition to higher property taxes, people could pay more for solid waste, water and storm water services under the proposed budget. It calls for an approximately 78 cents per month increase in solid waste fees, a $4.27 increase per month in water fees and a 47 cents increase per month in storm water fees.
Pay increases for city employees, police and fire
Jones’ budget calls for all hourly city employees to get a 5% raise in the new fiscal year. The city’s minimum pay would increase to $23 per hour, bringing the yearly salary for the city’s lowest paid employees to “roughly $47,840,” he said.
Jones said raises are necessary to maintain the city’s workforce, helping eliminate vacancies and “stabilize turnover.”
“It’s really important to make sure that we’re taking care of those that take care of us,” he said.
City employees previously got a 6% raise in the current budget, bringing the city’s minimum salary up from about $40,000 to $46,200. The 2024 budget also included an 8% raise for all CMPD officers and sergeants and a 5.5-8% pay increase for all Charlotte Fire employees.
CMPD and Charlotte Fire employees would get another raise under the proposed budget, ranging from 5-7.5% for most CMPD employees and from 5-8% for Charlotte Fire. The budget also includes more money to help manage workloads for first responders, including for civilian crash investigators, the CARES Team initiative and other new employees, Jones said.
$400 million on 2024 ballots?
In order to make other proposed spending happen, Jones wants to increase a planned bond referendum from $210 million to $400 million.
Under the higher bond, Jones’ proposed budget calls for the city’s Housing Trust Fund, which provides financing to developers for affordable housing, to be doubled from $50 million to $100 million.
The budget would also increase funding for the Corridors of Opportunity program to $30 million, with $15 million in new capital investment plan dollars for the project and an additional $5 million from other sources. The corridors program pumps public and private investment into six targeted areas around the city to spur economic development and improve equity.
For transportation, the budget calls for an increase in capital funding from $115.3 million to $238.3 million, including a call for a $16 million boost in funding for Vision Zero, an effort to eliminate traffic fatalities, and a $30 million increase in money for sidewalks.
Jones said the budget sets aside an additional $55 million for potential projects such as bike facilities, sidewalk improvements and streetlighting in targeted areas.
The budget also calls for a “career pipeline” partnership with Charlotte-Mecklenburg Schools, which will bring 17 CMS graduates into city jobs under a pilot program.
What’s next for city budget?
The City Council will hold a public hearing on the budget at its May 13 meeting, according to the council calendar. Additional conversations and meetings will be had as the council reviews the budget proposal, Mayor Vi Lyles said.
“We really need to take some time to read, review and inquire,” she said.
A straw vote is scheduled for May 30, with final adoption set for June 10.
The current fiscal year ends June 30.