Black Mountain considering property tax increase in budget talks

Town council turns to ad valorem revenue to address 2023-24 shortfall

Fred McCormick
The Valley Echo
May 25, 2023

The Town of Black Mountain is considering an increase of 1.5 cents to its current property tax rate, following a May 24 budget workshop meeting. Photo by Fred McCormick

Black Mountain property owners could see an increase in ad valorem taxes in the upcoming fiscal year, town council members indicated, May 24, as 2023-24 budget discussions continued in a special call meeting.

The proposal, which would raise the current property tax rate of 30.6 cents per $100 of valuation by 1.5 cents, would generate approximately $230,000 in additional revenue to cover an anticipated budget shortfall. If approved, it would mark the first such increase since 2010, and the second in over 30 years.

The town, in a Feb. 25 retreat, launched its budget planning process in earnest, as officials identified five spending priorities to shape the framework of the annual document. Town Manager Josh Harrold began presenting the town council an overview of the 2023-24 budget in an April 26 special call meeting, the first in a series of weekly workshops that will continue through May 31. Each of the first four meetings included presentations for budgetary requests from department heads, while Wednesday’s meeting focused on the five-year capital improvement plan and projected revenues.

Harrold, who will present his budget proposal to the town council later this month, recommended appropriating $600,000 from the town’s unassigned fund balance, leaving an anticipated shortfall of $418,000.

In an effort to balance the budget, the board explored cuts to personnel and capital projects requested in the upcoming fiscal year. A proposed 5% cost of living adjustment (COLA) for employees, who received a 5.75% COLA increase in the current fiscal year, was reduced to 4%, while the town delayed the addition of a new public information officer position. Plans for a $40,000 space needs study were also eliminated, as were plans to paint the town hall, at a cost of $15,000.

A deficit of around $200,000 remained.

“I know nobody ever wants to talk about it, but there is also the opportunity to increase revenue,” Harrold said.

Raising property taxes was an idea Councilmember Doug Hay had been considering, he responded.

“The unfortunate reality of why we’re having to make these decisions for the first time since I’ve been on the board is that, for many years we were only paving a little bit of the streets, and we were underpaying our staff,” Hay said. “We didn’t act when we had a pay study 10 years ago, and we fell further behind. We weren’t investing in new fire trucks, and we were afraid of debt. We have only raised taxes once in 30 years.”

An increase in ad valorem taxes, which generate the majority of the town’s revenue, last in 2010, according to Harrold, who added the rate had remained unchanged for 20 years prior to that.

Inflation, growth and demand for municipal services in the town, Hay added, prompted a difficult conversation for the board.

“There comes a time when we have to talk about taxes, and nobody wants to be the person to vote to increase taxes,” he said. “But, we’re in a time where we have to play catch-up, from years of kicking the can down the road.”

An increase of one cent for a home valued at $400,000 would result in $40 per year for Black Mountain property owners, while generating an additional $153,000 in annual revenue for the town, according to figures provided by staff.

“My fear is we can keep cutting stuff, and we could probably balance this budget by doing that,” Hay said. “But, we can’t cut things forever, because that’s how we got here.”

A 1.5 cent increase in the ad valorem rate would allow the town to address the shortfall while maintaining the lowest tax rate in Buncombe County, at 0.321, Councilmember Pam King added.

“We provide services that other municipalities do not provide. We have a swimming pool, for example, and better recreation opportunities than some of them,” King said. “It’s not a popular thing to do, but we have citizens that have every right to expect top-notch services, and it costs money to provide top-notch services.”

Black Mountain, Harrold added, spends more money, per capita, on its recreation department than any other municipality in the county. Increasing the property tax rate would allow the town to add to its existing recreation resources by funding a full-time manager position for the Dr. John Wilson Community Garden.

The proposed budget, if approved, will also create two additional positions within the Black Mountain Police Department, addressing what Chief Steve Parker called a “critical need” in the department’s annual report to the town council last April.

Harrold will present his recommended 2023-24 budget to the town council at 8:30 a.m., Wednesday, May 31, in a special call meeting that is open to the public. A public hearing will be held in June, before the board holds a vote on the proposal.