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Southern Pines holds first public hearing on FY2026 budget; tax rate unchanged
Summary
At a May 13 public hearing, town staff presented the draft FY2026 budget that keeps the property tax rate at 29¢, maintains a 25% reserve, proposes targeted capital transfers and modest utility rate increases, and leaves the $10 recycling opt-in fee unchanged.
Southern Pines held the first of two public hearings on the town’s draft fiscal year 2026 budget on May 13, during which Manager Parsons and staff outlined revenue assumptions, planned capital projects and modest fee increases ahead of the council’s planned adoption on June 11.
Parsons told the council and members of the public the town would keep its property tax rate at 29¢, which the presentation projects will generate about $13.4 million in property-tax revenue for the coming fiscal year. The draft maintains a 25% reserve fund balance (about $7.6 million) and estimates an available fund balance of roughly $648,000 for other uses.
The presentation highlighted several capital transfers, including funds for annual street resurfacing, a new fleet-facility design and engineering allocation, $200,000 toward completing the Bennett Street sidewalk connection, and a facility-modernization transfer that includes a slate roof for the downtown administration building. Parsons said some projects, such as a Carolina Green Parkway loan, are structured as general-fund debt but are paid annually by a municipal service district for properties within that district.
On rates and fees, Parsons said the monthly residential waste fee will increase (he described the change as “by 4 and a quarter” in the presentation) and that business fees would be $27.50 as presented; the recycling opt-in fee remains $10 per month and, staff said, has attracted just over 2,000 customers. Water and sewer availability and consumption rates are proposed to rise 2%, which Parsons said would add about $1.60 per month for a household using 5,000 gallons.
Parsons said sales tax has grown to roughly 22% of expected revenues while property taxes now account for about 48% of projected revenue. He reminded listeners that the town must adopt a balanced budget before the July 1 fiscal-year start and that a second public hearing will be held June 11.
During the hearing, resident James Landham expressed concern about recent solid-waste rate increases and warned that sustained rises could depress recycling participation; Manager Parsons and councilmembers discussed options including tracking recycling revenues and expenses separately or considering an enterprise fund for waste services. Parsons agreed staff could provide more detailed revenue-and-expense tracking and noted the recycling contract uses tiered pricing that affects whether the program covers its costs.
The council did not vote on the budget at the meeting; the matter returns to the council for a second public hearing and potential adoption in June.
