Asheville Council adopts $256.36 million FY 2025–26 budget with 3.26¢ tax-rate increase

Asheville City Council on a unanimous vote adopted a $256,360,000 operating budget for fiscal year 2025–26 that includes a 3.26¢ increase to the property tax rate, a set of employee pay adjustments and one-time funding to support storm recovery projects.

City Manager Deborah Campbell, presenting the proposal to council, said the budget "maintains the city's core services to the community, restores the fund balance in a manner to maintain the city's strong credit rating, and utilizes one-time revenue sources, such as community development block grant, disaster recovery grant funds, and federal emergency management agency dollars to fund the community's recovery priorities to enable us to build back better." The increase is intended to cover continuing operations, pay adjustments and to preserve the city's financial metrics.

Staff and council emphasized the budget's role in disaster recovery and workforce retention. Lindsay Spangler, budget division staff, told council that "the budget will include a 3.26¢ property tax rate increase, which will allow us to continue with current operations throughout the city" and reviewed adjustments added since the manager's budget, including funding for three additional firefighters to begin in January 2026.

Why it matters: The budget funds core city services while directing one-time federal and grant revenues to recovery work after Tropical Storm Helene. It raises the tax burden for homeowners and businesses at a time when the city is also managing large recovery projects and aims to shore up fund balance that supports capital borrowing.

Most important facts - Total adopted operating budget: $256,360,000 (presented as $256,100,000 in earlier slides, amended to $256,360,000 with two technical adjustments). - Property tax-rate increase: 3.26¢ (cents per $100 assessed value). - Employee compensation: Employees above the median on the general pay plan receive a 3% increase; employees below the median receive a $17.40 flat increase (equal to 3% of the median) to narrow pay disparity. Police and fire pay plans move to adjusted structures (police pay-plan transition; firefighters receive a 3% increase and funding for promotional steps). - Fire staffing: Council agreed to add funding for three firefighters to start in the January 2026 academy; the budget includes $155,000 in one-time fund balance this year to support half-year costs, with an estimated recurring cost of about $248,000 in future years. - One-time revenue: The proposed budget uses one-time sources, including a $5,000,000 loan from FEMA, CDBG‑DR and other recovery grants to fund storm-related capital and recovery priorities. - Fund balance: Adopting the firefighter positions shifts the unassigned fund-balance estimate slightly (staff noted a reduction from about 15% to 14.9% of operating expenditures).

Other budget changes approved at the meeting - A $100,000 general-fund budget amendment to provide the city's annual contribution to the Economic Development Coalition (funded from city manager's contingency) was adopted after a recusal motion for the mayor under state law. - A $45,000 general-fund budget amendment to fund the city's annual contribution to the Sports Commission (also funded from city manager's contingency) was adopted after a separate recusal motion for one councilmember.

Council discussion and context Councilmembers and staff described the budget process as lengthy and shaped by recovery needs following Tropical Storm Helene. Several councilmembers expressed concern about any tax increase while noting the constrained options without state revenue-replacement for storm losses. Councilmember Roni said she was "deeply concerned about the property tax increase after the natural disaster of Helene," but indicated support for the budget, citing the need to maintain services and compensate staff who worked on recovery.

Implementation notes and next steps Staff flagged that some one-time choices (for example, using fund balance to cover firefighter hires) will require future revenue decisions to sustain recurring costs. Departments will proceed with the projects and staffing included in the adopted budget; the city will return with program-level budgets for federal and community-development grant funds scheduled later in July.

Ending Council adopted the budget unanimously and approved the two contingency-funded amendments after the required recusals were offered and recorded. Staff will implement the adopted plan while continuing to brief council on recovery-program spending and the capital-improvement program.