Raleigh Residents Will Likely Pay More in Property Taxes This Year. Here’s Where the Money Will Go.

Brace yourself, Raleigh residents: a property tax increase is likely coming in the next fiscal year beginning July 1, but the 1.78-cent increase would pay for priorities as identified by Raleigh voters, including funding for parks and affordable housing. 

City Manager Marchell Adams-David last week included the planned tax increase as part of her $1.07 billion proposed city budget. The suggested tax rate represents 37.3 cents per $100 in property valuation. For a home valued at the median value in Wake County—around $255,000—that would represent about a $46 property tax increase over last year’s tax bill of $951. 

The city will host a public hearing on the budget at its meeting on June 1 but, at first blush, the council seemed impressed with the proposal.

“The budget really captures a lot of the priorities we discussed at our [council retreat in March], addressing issues of housing affordability, homelessness, transportation, stormwater, parks, greenway safety,” said Raleigh Mayor Mary-Ann Baldwin. “You got it all.”

Last fall, Raleigh voters approved an $80 million affordable housing bond. A planned parks bond referendum was canceled due to the COVID-19 pandemic, but in 2014, voters approved a $92 million parks bond that came with a long list of parks and greenway maintenance projects located all around the city that are still being funded. 

An additional one cent from the proposed property tax hike, generating a total of $7.6 million in annual funding, will go toward paying for new parks and greenway projects.

The rest—a projected $24.8 million this fiscal year from the 2020 bond, plus an additional $6.3 million from the general fund—will go toward affordable housing initiatives, such as transit-oriented site acquisition; public-private partnerships; low-income housing tax credit gap financing; owner-occupied home rehabilitation; and down payment assistance. 

At a work session last week, Larry Jarvis, the city’s Housing and Neighborhoods director, gave the council an update on where his department is in terms of partnering with Wake County on acquiring and preserving property for affordable housing, on public-private partnerships, and on appointments to the affordable housing bond’s executive subcommittee—the group of stakeholders who will decide how the affordable housing bond money is apportioned.

By early next year, Jarvis reported, a fund for the city’s acquiring land for affordable housing jointly with the county should be fully operational.

“[Offering up city-owned lots] is something I have really been pushing for,” said council member Jonathan Melton during the work session. “The city owning dirt is not helping anyone. If we want to build a city that is walkable and dense, we need housing in more places, and we can certainly offer up the land that we own to house folks who are in need of affordable housing.”

Additionally, in a partnership with the nonprofit Healing Transitions—a long-term recovery, non-medical detox, and overnight shelter—$3 million will go toward renovating and expanding the men’s shelter’s campus in a 0 percent interest, forgivable loan. 

Other partnerships include one with the affordable housing developer CASA on 100 new units in King’s Ridge, plus a budgeted $2 million for other small-scale projects. 

For those smaller scale projects, city staff proposed spending that $2 million, plus some $5 million in additional funds from the federal American Rescue Plan, on emergency shelters for families, transitional housing, and other affordable rental units with inclusion of units for very low-income households in partnership with Wake County.

“I want to say yes and yes to these proposals,” Baldwin said.

Follow Editor-in-Chief Jane Porter on Twitter or send an email to [email protected]. 

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