Earlier this year, a jaw-dropping increase in Cumberland County property values by the county’s tax appraiser stoked fears among residents that they will get a massive tax increase on July 1. The county manager on Thursday recommended that the county commissioners cut the property tax rate to a revenue-neutral level — but that doesn’t mean homeowners’ tax bills won’t rise.
A revenue-neutral tax rate means that the county’s new tax rate in the 2025-26 fiscal year should collect about the same amount of money as the old rate.
Data from the county suggests homeowners in general will see higher tax bills even with the reduced tax rate, while owners of commercial properties will see their property tax bills shrink.
The property tax rate would drop from 79.9 cents per $100 worth of property to 55.93 cents, County Manager Clarence Grier said on Thursday when he presented a proposed 2025-26 budget to the Board of Commissioners.
A home worth $270,000 faced an annual tax bill of $2,157 if the rate were to remain the same. Instead, under the tax rate Grier proposed, the home would be taxed $1,510. (Note that people living in Fayetteville, Spring Lake, Hope Mills and Cumberland County’s other municipalities pay municipal property taxes in addition to the county property tax.)
Bigger bills for homes, smaller bills for commercial property
The county re-appraises real estate values every eight years to ensure that the values in the tax records align with current market values. This year’s appraisal, the first since 2017, saw real estate values rise 64.7% overall. Housing rose more than the overall average. Single-family homes rose 84.2%, multifamily housing rose 167.1%, and condominiums rose 121.2%.
Meanwhile, commercial real estate values rose on average 27%.
Some of the consequences of these new assessed values and the new tax rate of 55.93 cents per $100 of value:
- For a single family home:
- Old value $146,580. Old tax rate 79.9 cents. Old tax bill $1,171.
- New value $270,000 (assuming an 84.2% increase). New tax rate 55.93 cents. New tax bill $1,510.
- For commercial property:
- Old value $1 million. Old tax bill $7,990.
- New value $1.27 million (assuming a 27% increase). New tax bill $7,103.
Some tax rates would not be cut
Even though the county’s main property tax would drop, there is a catch: Two special property taxes levied outside the city and town limits for fire service and for parks and recreation would not drop to a revenue-neutral level. They would stay the same as they have been before.
Those taxes are 15 cents per $100 for fire service, and 5 cents per $100 for parks and recreation, for a total of 20 cents per $100.
The combined taxes for fire service and parks and recreation come to $540 on a home worth $270,000. If the home was worth $146,580 before the revaluation, the owner paid $293 for those taxes.
By keeping these tax rates the same, the county will collect $6.5 million more for the fire departments, and $1.6 million more for parks and recreation, Grier said.
Grier said the fire departments have told him “inflation and the cost of equipment has risen to a level in which they need more revenues.”
As for parks and recreation, “When I’ve been out in the rural part of the county, in unincorporated areas, one of the constant things I hear is: ‘We need more parks. We need more parks and recreation in our community,’” Grier said. “With this increase in revenue, we’ll be able to achieve those needs.”
What will the taxpayers get for their money?
Grier advanced a $404.6 million budget for general government operations. There also is a capital projects budget of almost $28 million.
The county anticipates spending 20% of its general fund budget for public safety, 33% for human services, 15% for general governmental purposes, 27% for education, 2% for economic and physical development, and 3% for cultural and recreation purposes.
Some of the spending items:
- A 2.5% cost-of-living raise for county employees, estimated to cost $4.2 million.
- $3,000 increase in starting pay for entry level sheriff’s deputies and for Detention Center officers up through the rank of lieutenant. The sheriff has reported difficulties in filling positions.
- $91.7 million for the Cumberland County Board of Education, which is an increase of $2 million from this year. The Board of Education had requested $103.7 million.
- $2 million for school nurses and $1.6 million for school resource officers and crossing guards.
- $15.9 million for operations at Fayetteville Technical Community College plus $1.3 million for capital projects there.
What’s next? And public input
This proposal is not final. The commissioners need to pass a budget by June 30.
The commissioners plan to meet several more times to discuss and possibly make changes to the tax and spending plan. They also have scheduled a hearing for 7 p.m. June 5 to take suggestions from the public. The meetings will be at the county courthouse. They are open to the public.
Here is the schedule:
- 5:30 p.m. Thursday, May 29, work session in room 564
- 7 p.m. Thursday, June 5. public hearing, and optional work session, in room 118
- 5:30 p.m. Tuesday, June 10, work session in room 564
- 5:30 p.m. Thursday, June 12, work session in room 564
- 5:30 p.m., Thursday, June 19, work session (if needed) in room 564
Senior reporter Paul Woolverton can be reached at pwoolverton@cityviewnc.com.
Did you find this story useful or interesting? It was made possible by donations from readers like you to the News Foundation of Greater Fayetteville, a 501(c)(3) charitable organization committed to an informed democracy in Fayetteville and Cumberland County.
Please consider making a tax-deductible donation so CityView can bring you more news and information like this.
