Kannapolis considering lowering the tax rate even more after city budget public hearing

Published 12:10 am Thursday, June 13, 2024

KANNAPOLIS — The Kannapolis City Council held a public hearing regarding the proposed fiscal year 2024-2025 budget at its June 10 work session meeting. 

City Manager Mike Legg started things off with a “basics of the budget” presentation before residents were invited to share their thoughts with the city council. Different people discussed how they wanted to see more ways to protect trees, focus on infrastructure and protested about overspending and an increase in bills.

The tax rate for the proposed budget is 57.92 cents per $100 valuation, a decrease from the rate of 63 cents it is at now. Council member Jeanne Dixon initially brought up what a revenue neutral budget might look like. The revenue neutral tax rate is 47 cents per $100 valuation, but Legg said that it is “not viable as an organization.”

Another figure that was mentioned was a core service level tax rate of 52.5 cents per $100 valuation that pays for “base-level service” like keeping the departments adequately staffed, adding capital outlay expenditures and giving employees raises. 

Council member Ryan Dayvault spoke on last year’s Rowan County revaluation, this year’s Cabarrus County revaluation, and how the 57.92 cents tax rate could spell trouble for some living in Kannapolis. 

“I think that my goals here with this budget, or at least my opinion on it, I’ve never seen the inflationary pressures that we currently see impact us at the level that we’re seeing. This is unreal,” Dayvault said.

Dayvault admitted the city council is unable to manage nationwide inflation, but they can control Kannapolis’ tax rate. Dayvault’s three priorities for the city are public works, fire and police. New projects like the Midway area revitalization, cultural arts program and downtown dog park could be affected by a hypothetical change to the tax rate. 

“I think we just need to tap the brakes on some of this stuff for this year and maybe next year, too, and see if we can get a better deal on some of these things going forward,” Dayvault said.

After Dayvault made his comments, council member Dianne Berry read a prepared statement that mirrored what he said. 

“I cannot in good faith and clear conscience vote to approve the Kannapolis fiscal ‘25 budget as been presented with the Cabarrus County property revaluations,” Berry said. 

Berry also said how she did not want residents to pay higher property taxes while the city raises water and sewer. The proposed budget 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.

Mayor Darrell Hinnant cautioned with a lower tax rate, certain projects would be delayed and that it may have to be raised again down the road to pay for future projects.

“If we don’t follow this recommended budget that Mr. Legg has put forth, then when we get to the year ‘26, first of all, the projects are going to be behind,” Hinnant said.

Hinnant said he wants the tax rate to stay at 57.92 cents so that the city can go through the process of the projects and see the effects before making another decision on increasing it or not.

In the end, the city council decided that the two figures, 57.92 cents and 52.5 cents, would be looked at again at the June 24 meeting to figure out which one will be in the upcoming budget. 

Legg said, “52.5 is essentially keeping the lights on, plus a little bit of operational things — 57.92 includes a lot of new additions.” 

In addition to that, Legg said the city council will study the proposed water and sewer rates and how it would play out if they cut those in half.