NEW HANOVER COUNTY — County commissioners are locked in a stalemate over next fiscal year’s budget, with two commissioners supporting a revenue neutral rate and two commissioners advocating for the presented 33.9 cents; the board chair has yet to indicate where his vote will land.
READ MORE: Republicans lean toward further reducing NHC tax rate, NHCS capital ask diluted
The commissioners held a public hearing on the 2025-2026 budget Monday night after much chatter, between commissioners and in the community, on where the tax rate would end up.
The hearing fell largely along party lines. The chair of the NHC Democratic Party, Jill Hopman, advocated for a 33.9-cent tax rate, as presented by county staff before the hearing, and NHC GOP Chair John Hinnant advocated against it. The divide mirrors the one separating commissioners right now.
Republicans Dane Scalise and LeAnn Pierce remain committed to adopting a revenue neutral rate like other municipalities, including Wilmington and the beach towns, to keep tax bills as low as possible for citizens. However, because values have escalated by 67% in this year’s revaluation, property owners will still see increases in their property tax bill.
The revenue neutral rate would bring in the same amount of revenue as last year, though it doesn’t account for rising costs or priorities that commissioners have added to the budget since approval in June 2024. According to Coudriet and budget staff, the rate needed to continue the same amount of services is 35 cents, which represents a $40-million increase to the overall budget.
However, Zapple requested staff bring back a 33.9-cent rate, which both he and Commissioner Stephanie Walker see as a compromise.
The deciding vote will fall to Chair Bill Rivenbark.
“This is the hardest decision I’ve ever made in my life and I’m not going to make it tonight — I’m not going to vote tonight,” Rivenbark said.
Though Zapple would eventually make a motion to adopt the 33.9-cent budget, the move was essentially dead in the water after Rivenbark reaffirmed his refusal to vote. The chair said he would like to see more information from staff. The commissioners have another opportunity to adopt the budget on June 19, though if not adopted then, they could call a special session to do so before the June 30 deadline.
Though a Republican, Rivenbark has expressed doubts about a revenue neutral rate. He asked staff to bring back a balanced budget with a 29.2 tax rate; on Monday, he told the audience doing so would require the following:
- Forgo hiring staff and supplies for the Northchase Library and Project Grace
- Forgo requested cost-of-living adjustments for teachers and planned safety improvements
- Eliminate all non-county agency funding
- No cost-of-living adjustments for public safety officers and county employees
- Eliminate half of county-funded pre-K classes
- Forgo increased funding to the board of elections
In contrast, the 33.9-cent budget retains those priorities, though the maneuver cannot do so with property tax revenue alone. The current budget proposal requires the county to pull from other funding streams, including $8.1 million in debt and $4.3 million from the Mental Health and Substance Use Disorder Fund, two maneuvers Coudriet wanted to avoid this year.
The MHSUD fund was used for school nurses and therapists last year, but it’s also finite, meaning continuing the recurring expenses from the fund will deplete it in around five years.
The county manager also advocated against borrowing money for smaller capital purchases, such as vehicles, and instead using cash on hand to keep debt capacity available for larger projects.
However, using the money allows the county to accommodate $3.5 million more in budget enhancement requests from county departments. The additional $3.5 million was added at the behest of Rivenbark and two other commissioners.
Scalise was critical of the 33.9-cent budget Monday.
“It is 33.9 cents in name only; we are borrowing money to pretend that the rate is coming down,” Scalise said. “That is the epitome of bad governance.”
Scalise, in particular, has been vocal about his belief the government should only fund mandatory, core services; Rivenbark said he’s received several calls advocating for the same.
“We’re only mandated to have a sheriff and two deputies,” Rivenbark said. “We’d be like ‘The Andy Griffith Show’ if we did that. No fire department, we’d have to go back to volunteer fire departments.”
Both Scalise and Pierce suggested there were better ways to manage the county’s dollars. Pierce focused on the impact an above-revenue-neutral tax rate would have on taxpayers.
“We’re already looking at high interest rates; we’re looking at insurance increases again and again — that passes down to the homeowner,” Pierce said. “If you’re a renter, it passes down to you because they’re going to increase your rent so that they can pay that. Businesses will increase their cost of goods to cover those services that they’re providing.”
When Zapple pushed back, saying the county is experiencing, for example, the same insurance increases, Pierce said the county was better able to bear that load than taxpayers.
Pierce has also taken issue with adding positions into the budget, which she said are hard to eliminate once they’re there. For example, Pierce called out the 23 new positions “just for the library system.”
Commissioner Walker pointed out why that was the case.
“There are several people on this panel that have approved opening a new library and buying pieces of land that eventually would cost money to fund,” Walker said.
The county actually has two libraries in the works — Northcase and the new downtown library as part of Project Grace. Both will need staffing and supplies once opened this year.
As for the land purchase referenced, Walker was talking about the Flossie Bryan tract, which the county purchased for a net cost of $3.8 million, to be funded through the Revenue Stabilization Fund instead of putting it on the tax rate. Scalise was the major proponent behind buying the tract.
Zapple was wary of the notion the county didn’t need to increase funding to address added expenses.
“There seems to have been this kind of sense that we started with a budget number that was full of wants, not needs, and that has never been the case,” Zapple said Monday.
Coudriet hopped into the conversation to explain what it would take to get to a revenue neutral rate, noting staff were tasked with balancing a budget based on current board policy. He said his staff could present a 29.2-cent budget, but he believed doing so would take direction from commissioners on “what policy is in and what policy is out.”
“Nobody elected us, so we always try and echo back to the board what is in play and/or what you’ve expressed as priority,” Coudriet said. “This rate can be exactly what the board directs it to be, but I don’t think we get there by line items, it would have to be a substantive revisit of policy.”
Rivenbark made the observation that no one on the board has pointed to a policy they want to eliminate.
While true for Monday’s discussion, Commissioner Scalise has noted in the past his desire to discontinue the county’s affordable housing commitment and belief The Endowment should take over non-county agency funding. Still, this would amount to less than $5 million of the $40 million needed to reach the revenue neutral goal.
Pierce claimed commissioners don’t know where to cut the excess “fat” she says exists.
“That’s the problem; but there are people that do,” she said, referring to staff?.
Coudriet again chimed in that the county operates on thin margins, but there are ways to cut spending if commissioners were to agree on what policies they no longer want to support. Using the affordable housing strategy as an example, he said the commissioners are not beholden to a decision that three commissioners weren’t on the board to make, but until a vote was taken to eliminate it, he didn’t consider it within his authority toleave it out of the budget.
“The only way to achieve that is for it to be — and I say this with all due respect — is for it to be political choices,” Coudriet said. “That is, by definition, what elected officials do, is decide who gets how much of what.”
Scalise agreed with Coudriet’s assessment and noted commissioners have yet to come to a consensus on anything worth cutting.
“Obviously, we have some philosophical differences here on the size and scope of government and what all of that means,” Scalise said.
The commissioner committed to another budget work session if his fellow commissioners wanted to rehash areas of the budget.
Despite the suggestion the county government is doing too much, Pierce and Scalise did not ultimately object to the items included in the $3.5 million addition to the budget.
Included in the $3.5 million is $225,882 for the Board of Elections to fund all enhancements and continuation funding at the department requested level. Last week, the BOE and New Hanover County leadership squabbled over an advocacy email pushing the commissioners to fund the BOE’s full request. The email, sent by BOE Chair Derrick Miller, allegedly broke county policy against using its email server to advocate for certain causes.
The remaining amount will be used on the following:
- Economic Development: An additional $184,856 has been allocated to bolster economic development initiatives. This includes funding for the Arts Council of Wilmington & New Hanover County, increased funding for Cucalorus Film Foundation, Wilmington Downtown Inc., and the Chamber of Commerce.
- Non-County Agency Support: Funding was increased by $345,082 to provide greater support to our non-profit community partners
- Senior Resource Center: Full funding of an additional $316,003 was provided to support all enhancements proposed for Senior Resource Centers. This provides funding for one senior health insurance information program specialist, one social worker position, and one social worker supervisor position.
- Information Technology: An IT Analyst enhancement was funded with $133,870 to strengthen technology capacity.
- School-Based Mental Health Services: A total of $610,573 was allocated to support student mental health, including $529,530 for six licensed school therapists and $81,043 for one licensed therapist specializing in Parent-Child Interaction Therapy. These costs are also proposed to be funded by the Mental Health & Substance Use Disorder Fund.
- Library Services: $205,112 was dedicated to fund two teen librarian positions to expand youth engagement and programming. These Librarians will be located at the Main Library location and the Northeast Library.
- Parks and Recreation: Additional Enhancements include $18,500 for Ogden Dog Park parking lot repaving, $50,000 for LED lighting at the Roland Grise ballfields, and $300,000 for demolition and construction of a pedestrian bridge at Long Leaf Park.
Administrative Reserve: Due to borrowing at capacity for capital outlay items and use of the Mental Health and Substance Use Disorder (MHSUD) fund we recommend an additional $1.14 million in additional administrative reserve for a total of $2.1 million.
Reach journalist Brenna Flanagan at brenna@localdailymedia.com.
Want to read more from PCD? Subscribe now and then sign up for our newsletter, Wilmington Wire, and get the headlines delivered to your inbox every morning.
