Kannapolis approves budget with 7.05-cent tax decrease

KANNAPOLIS — The members of the Kannapolis City Council voted 4-to-3 to approve the budget for the 2024-2025 fiscal year on Monday, complete with a 7.05-cent decrease in the property tax rate.

Originally, City Manager Mike Legg had presented the council with two separate tax rates, 57.92 cents and 52.5 cents. However, Mayor Darrell Hinnant said that there was a proposed third rate, 55.95 cents per $100 of property valuation, that was brought forward on Monday to provide a compromise between the two numbers. The property tax rate for the 2023-2024 fiscal year was 63 cents.

City council members Ryan Dayvault and Dianne Berry and Mayor Pro Tem Doug Wilson voted against the budget that included the 55.95 cents, while city council members Tom Kincaid, Darrell Jackson and Jeanne Dixon and Hinnant voted for it.

The difference between the 52.5-cent proposal and the compromise proposal was an additional $3 million to the general fund during the upcoming fiscal year.

The main differences between the budget was large-scale capital projects that the city has planned as part of the “Imagine Kannapolis” strategic plan, which outlines the city’s goals for the next five years.

With the reduced rate, the city will be looking at project decisions “on a year-to-year basis and pushing some projects to the third or fourth year,” said Hinnant. One of the main projects he pointed to that would have to be pushed back was the revitalization of the Midway area.

Many of the future projects, even ones in years beyond the upcoming one, would require funding in the 2024-2025 budget to purchase right of ways, fund design work or even address pressing needs, Hinnant said during the June 10 work session, according to the minutes. If that tax rate is reduced, that preparation may not be fully addressed, he said.

“With all of these things that the community has told us that they want, that they prioritize, we have to figure out how we can do them,” said Hinnant.

He also said that one of the main points in the conversation was the council’s wish that the approved tax rate stay constant for five years, saying that they did not like the idea that residents could be dealing with big changes in their tax bills yearly.

The three members of the city council that voted against the budget, Berry, Dayvault and Wilson, had all said during recent budget discussions that they hoped to get the tax rate as low as possible.

“My focus was on the citizens’ needs over the council’s wants,” said Berry.

Both Dayvault and Berry pointed to Cabarrus County’s revaluation process the past year and Rowan County’s revaluation the year before, saying that the city council needed to do everything possible in the upcoming year to help reduce the burden upon the residents.

“My perspective was that this year we needed to hit the brakes, because the Cabarrus County revaluation hit very hard, just as the Rowan County revaluation did the year before,” said Dayvault.

Wilson said that he voted against the budget because he believed that the 52.5-cent rate provided for the needs of the city during the upcoming fiscal year, such as cost of living increases for employees and other employee retention strategies.

He also pointed to the capital projects, noting that many of the ones with plans in future years had not yet been discussed. He specifically pointed to the Midway area revitalization, saying that he could not even say whether or not the project was feasible because it had not been brought before the council.

Both Wilson and Berry said that they only received the 55.95-cent proposal a few hours before the meeting, saying that the short timeframe to look into the budget contributed to their votes.

At the 55.95-cent tax rate, the budget still includes multiple capital projects and initiatives such as $1.5 million for a fire training tower, $2.85 million for city hall upgrades, $1.2 for a western Cabarrus emergency communications tower, $1.34 million for the city’s portion of the Little Texas Road sidewalk project and more, according to a press release from the city.

The approved budget also has the sewer base rate being increased by $1.44 per month, sewer volume rate by 75 cents per 1,000 gallons, and the water volume rate by 51 cents per 1,000 gallons.

It also includes cost of living and merit raises for city employees, increases to health insurance and retirement programs and an employee daycare subsidy, according to the city’s release.

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