Montreat Town Council adopts budget amendment, sets ad valorem rate at 0.535 to preserve approved revenue

The Montreat Town Council on a special-call meeting adopted an amended FY2026 budget and set the town's ad valorem tax rate at 0.535 (53.5 cents) per $100 of assessed valuation to preserve the revenue level previously approved by the council.

A staff member explained the change stems from recently enacted legislation by the North Carolina General Assembly that requires Buncombe County and some other counties to bill taxes using prior property values for this year rather than the newly completed revaluation. "Because the tax base is reverting to the previous valuations, the Town must also adjust its tax rate to generate the same revenue that was included in the adopted budget," the staff member said, adding, "While the tax rate will increase from the rate previously adopted, this change will not raise additional revenue beyond what was approved in the budget. It is a technical adjustment to account for the lower property values that will now be used for taxation." (Staff member)

Council members reviewed the budget materials and asked for line-by-line and arithmetic clarifications. The staff said the total proposed budget remains $3,020,918 (a 20.7% increase over the prior year), with General Fund revenues projected at $2,442,818 and Water Fund totals of $578,000 (a 36% increase). The staff also said the team removed approximately $20,000 from various departments to avoid a higher tax rate while keeping the town’s revenue target unchanged.

One council member asked to "see the math," and another requested that the public be told this change is temporary and will be revisited next year if the county implements the revaluation. The staff said the moratorium passed by the General Assembly lasts one year and that rapid-growth counties were most affected, though staff had not compiled a list of every county's choice on the revaluation.

With no members of the public requesting to speak during the hearing, the council closed the public hearing, returned to regular session and voted to adopt the budget and set the tax rate; the Chair announced, "Ayes carry." The meeting adjourned after handling the motion to adjourn.

The budget action maintains the revenue the council had already approved but applies a higher rate this year because the county will use earlier assessed values. Council materials provided at the meeting show the ad valorem rate and the budget message; the council directed staff to include an explanatory note about the temporary nature of the change in the public-facing materials. (No public comments were recorded.)

Next steps: The tax rate and the amended budget take effect as adopted. The council said it will revisit the rate next year if Buncombe County moves forward with the new revaluation.