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Nags Head adopts FY2025-26 budget, raises tax rate to boost beach-nourishment reserve
Summary
The Board of Commissioners adopted the FY2025-26 operating budget and related measures June 11, increasing the town's tax rate from the manager's recommended 22 cents to 23.2 cents to add 0.5 cents (moved to 2.0 cents) for beach nourishment and shift 0.7 cents to the ad valorem rate; staff reduced the fund balance appropriation to balance the ordinance and added a $400,000 sales-tax in/out budget item.
The Nags Head Board of Commissioners adopted the town's operating budget for fiscal year 2025-26 on June 11 after a public hearing and staff presentation on changes to the manager's recommended spending plan.
Amy Miller, deputy town manager and finance officer, said the board and staff adjusted the manager's recommended 22-cent tax rate to 23.2 cents after neighboring towns' decisions threatened shared revenues tied to prior-year levies. Miller said the board allocated that increase by boosting the beach-nourishment portion of the tax rate from the recommended 1.5 cents to 2.0 cents (approximately $250,000) and assigning the remaining 0.7 cents (about $350,000) to the ad valorem rate.
"What we did was we increase the tax rate...and allocated a half a cent to the beach nourishment portion of our town tax rate that was recommended at 1.5 cents and we moved that up to 2 cents," Miller said, explaining the change will seed the capital reserve for planned fall beach-nourishment bids.
Miller also said staff added an accounting entry for sales tax (an in-and-out item) and budgeted $400,000 consistent with auditor and state guidance; she said that entry does not change the town's net resources. To offset the tax adjustments, the board reduced the fund-balance appropriation compared with the manager's original ordinance.
During the hearing the board approved, by motion and voice votes, several budget-related items included in the ordinance package: the operating budget pay scale, an amended personnel policy (including a clothing allowance and a salary differential), a CIP request, an amended consolidated fee schedule, adoption of the FY26 operating budget ordinance, and an amended septic-health policy.
Miller said the additional beach-nourishment allocation will be deposited in the town's capital reserve fund to help defray future project costs and limit the need for larger tax increases later.
The board took all budget votes by voice; minutes record motions and unanimous "aye" responses but do not list explicit tallies in the hearing transcript.
