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Blowing Rock presents 2025–26 proposed budget: no tax increase, modest draw on fund balance; water/sewer rates to rise
Summary
Town staff presented a structurally balanced 2025–26 draft budget with no proposed property tax increase, a planned use of about $194,000 of fund balance, a proposed 2.5% COLA for employees, and a 7% water/sewer rate increase to cover debt and projects including a pending USDA loan.
Town staff presented the proposed 2025–26 budget to the Blowing Rock Town Council, outlining revenues, major expenditures and next steps in the adoption process.
Shane (town staff) said the draft budget proposes no property tax increase for 2025–26 but would use approximately $194,000 of unassigned fund balance (about 46% of the general fund as of June 30, 2024 was reported at roughly $6.4 million) to balance the plan. The presentation emphasized the town’s revenue diversification: property taxes make up about 44–45% of general fund revenue while sales tax and TDA (tourism development authority) revenues combined account for roughly 38–39%, reflecting the town’s tourism‑driven economy.
Key budget elements presented: a proposed 2.5% cost‑of‑living adjustment for full‑time staff (81 full‑time positions unchanged), a projected employer retirement cost increase (cited example: pension contribution rising from ~16% to ~21.7% due to plan demographics), and a projected 7% water/sewer rate increase (about $4/month) to cover debt associated with recently installed AMI water meters and upcoming projects. Shane said the town will pursue a USDA loan of approximately $4.6 million for water plant, wastewater plant and lift station upgrades (the USDA amount would roll on in a later budget cycle).
Shane identified operating cost pressures such as increased legal and audit fees tied to hurricane recovery work and higher cybersecurity/IT costs. Capital outlay includes a fleet schedule and a $415,554 capital plan for the year (police vehicle, street equipment, financial software conversion payment). Debt service for the general fund was shown at about $8.9 million outstanding with an annual projection of roughly $1.75 million in debt service for 2026.
Staff said the budget document will be posted online and a public workshop is scheduled for May 27; a public hearing is set for June 10 where the council may adopt the budget before the fiscal year ends June 30. Shane noted that adjustments will be discussed at the workshop and hearing, and urged public review of the posted budget materials.
Next steps: budget workshop May 27 (public may attend but not participate) and public hearing June 10 (public comment and possible adoption).
