After weeks of intensive meetings and adjustments, the Fayetteville City Council voted 9-1 Monday to approve a budget for the fiscal year that begins July 1.
The $315.2 million budget represents a $5.8 million decrease from last year’s spending plan. The property tax rate is 44.95 cents per $100 of assessed value, a 13-cent decrease from the current year. The Central Business Tax District rate, applied only to property owners of downtown businesses, will drop from 17 cents per $100 valuation to 14.89 cents.
Stormwater and solid waste fees will remain the same, as will bus fares. The residential stormwater fee is currently $84 per year, the solid waste fee is $275 per year, and the bus fare for one trip is $1.25 for an adult passenger.
Under the approved budget, city employees will also get a 4% merit-based salary increase and a 1% increase to 401(k) contributions.
Despite the decrease in the property tax rate — the city has proudly declared it’s the lowest rate in 30 years — many residents will likely end up paying more in property taxes. That’s because of the recent property revaluation in which residential property values in Fayetteville increased by 88.4%.
The budget is also 6 cents over the revenue-neutral rate, or the property tax rate that would generate the same amount of property tax revenue as the previous year. This indicates that the city is planning to collect more property tax revenue in the upcoming year than it did last year.
Council Member Mario Benavente, who cast the only vote against the budget, raised concerns about exceeding the revenue-neutral rate.
“I think that we as a city heard from a lot of community members about their concerns with the increase in property values and whether or not we were going to make an adjustment in the direction that is most beneficial to most people,” Benavente said. “I asked for data back to show distribution of what that looks like. Who exactly is seeing their valuations go up 200%? Who’s actually seeing theirs only go up marginally? I never saw that information returned to us to be able to better assess whether this 6 cents over revenue-neutral is actually benefiting enough people as a reduction in our tax rate.”
Additional budget highlights:
- $92.3 million in new capital investments
- $30.7 million for stormwater improvements
- $20.6 million for public safety and public safety IT infrastructure
- $9.5 million for parks and recreation
- $11.7 million for transportation upgrades
- $6.2 million for additional community needs (public safety cameras, neighborhood enhancements, sidewalk expansions)
- $4.6 million to enhance employee compensation
Property taxes are expected to generate about $104.9 million in revenue for the city in the upcoming fiscal year, with about $51.5 million in sales tax revenue. With other revenue streams, the city is expected to bring in about $208 million. The city will have a net loss of sales tax revenue of about $3.1 million and reduced motor vehicle ad valorem tax revenue of $2.4 million.
After being presented with the recommended budget in May, the council added $6.2 million in new investments, including expanded public safety camera systems, compensation adjustments to address police and fire pay compression and neighborhood enhancements such as street signage, splash pads, right-of-way maintenance, economic development and additional sidewalks.
Government accountability reporter Evey Weisblat can be reached at eweisblat@cityviewnc.com or 216-527-3608.
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