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Union County staff outline FY26 budget outlook, CIP priorities and bond tax impacts after revaluation
Summary
County staff presented fiscal projections, a six-year capital improvement program and models for upcoming voter-approved bonds; revaluation increased the penny value and narrowed the revenue-neutral rate, but staff warned voter-approved school and college bonds will require added debt service above revenue-neutral rates.
Union County officials on April 14 outlined revenue projections, a proposed six-year capital improvement plan (CIP) and the tax-rate impact of upcoming general obligation bond issuances the county plans to sell in July.
Finance Director Beverly Lyles, Budget Director Jason May and Facilities Director Chris Boyd presented the county's capital requests and debt models and answered commissioners' questions about timing, priorities and tax impacts.
What staff told the board
- Revaluation and penny value: Jason May said the county is using a new penny value of $6,081,022 for modeling after the revaluation. The county's revenue-neutral tax rate calculation shown to the board was 41.59'cents per $100 of assessed value; the county's current tax rate is 58.85'cents.
- Revenue and timing: May said staff was finalizing third-quarter revenue and expense projections and planned to deliver a complete third-quarter report by May 1. He described ad valorem growth modeling based on four years of historical growth (about 4.119% used in the example) and cautioned that sales tax projections are volatile.
- FY26 capital requests and funding: Lyles said departments requested about $6.8 million in county general fund capital for FY26; she recommended funding one-time capital with unassigned general fund balance consistent with board policy that allows one-time fund balance for capital or debt reduction.
- Major capital projects: Facilities Director Chris Boyd reviewed proposed projects including Progress Building renovations (transportation office and training space contingent on federal transit grant), roofing replacements, fueling stations at three county locations, a Cane Creek Park outdoor recreation building and Patton Avenue parking and stormwater improvements. Boyd said the jail study is ongoing and the county had placed a placeholder amount for a future jail option but no final decision had been made.
- Public safety and other capital: Staff described ongoing, level-funded programs including replacement cycles for ambulances and SCBA (self-contained breathing apparatus) for fire departments, radio system upgrades to the 800-megahertz system for interoperability with first responders, and IT infrastructure replacements such as uninterruptible power supply (UPS) devices and annual aerial imagery (Pictometry) updates.
- Bonds and debt models: Lyles said the county expects to go to market in July to issue roughly $85 million in general obligation bonds, combining previously voter-approved school bonds and a South Piedmont Community College bond. She said the models assume a conservative 5% interest rate and do not assume any bond premium.
Tax-rate implications presented to the board
- Education debt fund: Using the updated penny value and conservative assumptions, staff estimated the additional tax-rate increase needed to cover the voter-approved school and college bonds would be about 1.82 cents per $100 of assessed value for FY26 above the revenue-neutral rate; staff estimated a sample homeowner with a $100,000 assessed value would pay about $18.20 more per year and a median-value home (presented at $450,000) would pay about $82 above revenue-neutral for education debt.
- Total debt funds: Lyles presented an estimated total tax rate for all county debt funds of about 5.41 cents per $100 with the education increase included; she emphasized that the county would continue refining models as additional data arrives and that premium from a bond sale is not guaranteed and should not be relied on in budget adoption.
Board reaction and next steps
Several commissioners thanked staff for the detail and asked for printed copies of specific slides and models. Staff said the next steps include completing the third-quarter report, returning bond-resolution language in May and presenting the manager's recommended budget and public hearings in late May and June with budget adoption planned for June 16.
Ending
Staff emphasized the models are conservative and that the county will continue to refine assumptions during May and June as the board prepares for FY26 budget adoption.
