Some Asheville residents will face higher taxes from multiple sources next year.
At last night’s Asheville City Council meeting, council members voted to increase taxes in two ways: through a property tax increase and the creation of a new business improvement district, or BID, which will levy a new property tax for a zone in downtown Asheville.
City officials also plan to hold a vote on a $80 million general obligation bond in November, which would increase the tax rate by around three cents. And Buncombe County leaders are considering a 2.55-cent property tax rate increase – commissioners will vote on that next week.
Last night, council approved a property tax rate increase of 0.63 cents in order to balance a $250 million budget. To make the budget, the council is tapping into the city’s reserves for $7.75 million. This leaves the city with $26.8 million in fund balance, slightly under the policy goal of 15%.
In its original budget proposal, there was no tax increase. But after a May 28 public hearing where some commenters demanded increased firefighter pay, City Manager Debra Campbell reconfigured the proposal to include a budget that pays firefighters and police officers a minimum annual salary of $50,000.
Council member Sage Turner, who supported the tax increase, said there was no other way.
“I don't want to raise taxes if we don't have to, and I want to pay people like they matter. Unfortunately for us to pay people what they're worth, we have to charge the rest of you to do it,” she said.
Council member Maggie Ullman echoed Turner. “If there's no money left in the piggy bank, you have to figure out a way to get more money in the piggy bank,” she said.
The change brings the property tax rate from 40.30 cents per $100 of assessed valuation to 40.93 cents per $100. The increase is estimated to add around $22 in additional costs to the average taxpayer, according to a report prepared by the city’s Finance Director Tony McDowell.
The budget passed in a 4-3 vote, with Antanette Moseley, Sheneika Smith and Kim Roney opposing the hike.
“People are crunched. And I do not want to raise property taxes without pulling all of our guns out,” Smith said. “I’m sure there are places we can cut.”
Council debated a few options for balancing the budget without a tax increase. Ideas included delaying a $300,000 transit study, deferring a $500,000 allocation to the city’s housing trust fund and reducing pay increases for city employees with higher salaries.
Mayor Esther Manheimer said these strategies were “not advised.”
“We're creating a budget that has recurring expenses. Salaries are paid year after year after year. If you give someone a pay raise this year, you’ve got to pay it next year. To patch a hole with the money for a one-time study or a one-time grant for a housing project doesn't compute,” she said. ”That is not how you balance a budget,”
Smith said she would have supported the original budget proposal, which provided a 4.11% compensation increase for city employees across the board.
The budget will go into effect on July 1. Nearly 40% of the funds will support employee salaries and wages. The budget will also create eight new public safety positions to grow the city’s community responder program and 21 positions that will primarily support stormwater services and repair.
Despite mixed reactions from public, BID passes easily
Dozens of community members carrying signs and banging pots and pans, along with a full brass band, protested outside last night’s meeting at Harrah’s Cherokee Center. The groups objected to the creation of a proposed business improvement district, or BID.
But the protests did not sway most of the council, who went on to approve the BID in a 6-1 vote, with Roney as the sole dissenter.
Under the plan, an estimated $1.25 million in tax funds will be used for enhanced cleaning, safety and hospitality services and beautification in downtown Asheville.
The district will be funded through a new tax on downtown property owners – 0.0877 cents per $100 of taxable value. So, a property with a taxable value of $500,000 would pay around $460 per year.
The original operation plan, proposed by the Asheville Area Chamber of Commerce and Asheville Downtown Association, received significant criticism from the public around its transparency and lack of board representation for renters.
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In order to assuage some concerns about how the BID would operate, council approved a resolution that lays out the intended structure for the BID.
Council member Maggie Ullman said the council will still oversee the BID in case it doesn’t go as planned.
“So if this goes off the rails, which I do not think it will, but if something really gets out of step with what we say we want now and what the community is needing. This time every year we're going to have a conversation about it,” she said.
One big change to the original plan was the BID’s board composition. Originally, the board was to be managed primarily by property owners. The new plan created a more even split between property owners and renters downtown.
The BID also must comply with all public records and open meetings laws, the resolution stated.
The resolution maintains support for the ambassador program, which would hire unarmed community stewards to “provide a highly visible presence; proactively engage with the public; provide directions and assistance; offer safety escorts on an on-call basis; and connect members of the unhoused community to resources like the Community Responders, Community Paramedics, homeless service providers, etc,” according to the resolution.
The resolution outlined that the ambassadors would receive anti-racist training, equity training, mental health first aid training and de-escalation training.
Resident Nina Tovish opposed the district – and its accompanying tax.
“There’s going to be a serious sticker shock,” Tovish said. “If the business community wants this, why aren’t they putting together an association and doing it themselves?
The next step for creating the BID will be to find an organization to run it. The city will open applications for that role via a Request for Proposal, or RFP, in the next three months. The organization awarded the contract will also be tasked with creating a steering committee, or board, of local business owners and residents to oversee the BID’s services.
From public comment
- More than 15 residents spoke against the proposed BID during public comment. “By steamrolling ahead on the BID despite so much of this public outrage, this city council has shown me that you don't actually care what your constituents have to say,” resident Gabrielle Bonfiglio said.
- Members of Strong Towns Asheville, an advocacy organization for “resilient, safe, and prosperous communities,” shared a series of presentations with recommendations for the upcoming repaving of West Asheville’s Haywood Road. Their suggestions included surface treated crosswalks, green painted bike lanes and reducing travel lanes to a 10 foot width.
- Several residents spoke in relation to the Israel-Gaza war, with some advocating for a ceasefire and others warning council about rising antisemitism in Asheville.
Other tidbits
- Council approved a $269,000 contract with Urban Canopy Works to create an urban forestry master plan. This was part of a five-item consent agenda, which was passed unanimously.
Every second and fourth Tuesday, Asheville City Council meets at the Council Chamber on the 2nd Floor of City Hall, 70 Court Plaza beginning at 5:00 p.m. See the full recording of the June 11 meeting and the agenda.
