Title
Public Hearing on the Proposed Fiscal Year 2026 Operating Budget and Fiscal Years 2026-2030 Capital Investment Plan
Action
Action:
Conduct a public hearing on the City Manager’s Proposed Fiscal Year 2026 Operating Budget and Fiscal Years 2026-2030 Capital Investment Plan.
Body
Committee Chair:
Dimple Ajmera, Budget, Governance and Intergovernmental Committee
Staff Resource(s):
Marcus Jones, City Manager’s Office
Marie Harris, Strategy and Budget
Teresa Smith, Finance
Explanation
§ On May 5, 2025, the City Manager presented the Proposed Fiscal Year (FY) 2026 Operating Budget and FY 2026-2030 Capital Investment Plan. The proposed budget represents the city’s proposed operating and capital budgets for the fiscal year which begins July 1, 2025.
§ State law requires the city hold a public hearing following the presentation of the Manager’s Proposed Budget and prior to the City Council adoption of the budget, currently scheduled for June 9, 2025.
§ Charlotte’s Proposed FY 2026 Budget was developed to lead the City of Charlotte toward addressing the most foundational and pressing needs of the city.
Proposed FY 2026 Operating and Capital Budgets’ Summary
§ The City Manager’s Proposed FY 2026 Operating Budget and FY 2026-2030 Capital Investment Plan were developed consistent with the City Council’s strategic priorities. These priorities served as the foundational elements against which all FY 2026 budget decisions were measured.
§ The proposed budget includes a property tax rate of 27.41¢ per $100 of assessed valuation, the same rate as FY 2025.
§ The proposed budget for the city consists of three major components supported by general tax revenues:
- A General Fund budget of $943.5 million for FY 2026, representing a 5.2 percent increase from FY 2025, to support initiatives that will continue to deliver exceptional government services to the community;
- A $200.4 million Municipal Debt Service Fund; and
- A $86.1 million General Capital Investment Plan for FY 2026.
Proposed FY 2026 Budget Highlights
§ Balances budget without a property tax increase
§ Preserves core services
§ Maintains operating reserve levels with no use of one-time revenues such as General Fund fund balance
§ Continues Charlotte’s legacy of affordable cost of service, with the expectation of maintaining the lowest tax rate among North Carolina’s largest cities in FY 2026
§ Protects current employees-no layoffs or furloughs
§ Begins a four-year plan to improve Solid Waste Services’ cost recovery to 50 percent for Residential Curbside collections by splitting the Solid Waste Fee into two fees, Residential Curbside and Residential Dumpster, and increasing the Curbside fee by $1.35 per month and the Dumpster fee by $0.49 per month
§ Establishes the Office of Youth Opportunities to promote economic opportunity and positive youth development for ages 13-24
§ Continues the city’s commitment to violence reduction through investments in the Alternatives to Violence program along Beatties Ford Road and provides funding for the expansion of Atrium Health’s hospital-based violence intervention program, Project BOOST
§ Supports minority, women-owned, and small businesses with nearly $2 million to establish the Small Business Readiness fund to build capacity in targeted industries, especially those related to mobility investments, and to continue NXT|CLT and Amp Up
§ Leverages more than $1.8 million in funding to support urgent home repair, affordable housing placement, and high-quality naturally occurring affordable housing in addition to the $100 million voter-approved 2024 Housing Bond to increase affordable housing production
§ Invests $1 million to start a community benefits fund to help advance the greatest needs identified in the 14 Community Area Plans
§ Continues the city’s Education to Employment (E2E) program, giving Charlotte-Mecklenburg Schools graduates opportunities to apply for entry-level positions within the city
§ Continues being a leader in municipal sustainability led by the Strategic Energy Action Plan with:
- $2.5 million to support the installation of sustainable infrastructure at city-owned facilities
- Funding for 45 electric vehicles and 155 hybrid vehicles to reduce emissions in the city’s fleet, as well as the continued conversion of the Airport’s bus fleet to electric vehicles
§ Invests $25.6 million in Fire infrastructure by advancing the construction of five firehouses (three new infill and two replacements) and expansion of one existing firehouse to accommodate an additional fire company
§ Adds a Commercial Burn Building to the Advanced Planning and Design Program to support on-going training for Charlotte firefighters
§ Funds $30 million over the next four years for a satellite Animal Care and Control adoption facility that is currently in design
§ Elevates Charlotte Business INClusion and the General Services’ Procurement Division into the new Contracting and Procurement Department to optimize cohesion and the expertise within these core services
§ Establishes a new Organizational Improvement Team that will identify opportunities to streamline operations, improve service delivery, and improve customer satisfaction beginning with the new Contracting and Procurement Department as well as the CLT Development Center
§ Realigns Animal Care and Control services from Police to the General Services department to allow Animal Care and Control to more directly benefit from General Services’ administrative strength and perspective for non-sworn services
Proposed FY 2026 Employee Compensation and Benefits
§ Annualizes costs for FY 2025 employee salary actions
§ Increases the minimum pay for city employees to $24/hour
§ Funds a four percent salary increase for General Hourly Employees (1.5 percent in September and a 2.5 percent merit pool in November)
§ Provides a three percent merit pool for salaried employees
§ Covers the majority of healthcare increases for employees, and increases the city’s employer contribution to city-provided medical, dental, and other employee benefits by 7.5 percent
§ Continues flexible work options for feasible positions
§ Provides a 6.5 percent pay increase to most Sworn (including existing pay plan steps) for eligible Police and Fire employees who are not at the top pay step; Police and Fire employees who are at the top pay step receive a 1.5 percent market adjustment and a 1.5 percent one-time bonus (for a total of three percent)
§ Provides for increases in the city’s contribution to the Local Government Employees’ Retirement System and Charlotte Firefighters’ Retirement System in order to responsibly fund the city’s pension liabilities
Proposed FY 2026 Nongeneral Departments’ Revenue
§ Charlotte Water: The FY 2026 Water and Sewer Fee for the typical homeowner is proposed to increase by 6.81 percent. The typical homeowner would experience a $5.47 per month increase.
§ Storm Water: The FY 2026 Storm Water Services Fee is proposed to increase by 6.60 percent. The typical homeowner would experience a $0.67 per month increase.
§ Aviation: Select non-regulatory fees were adjusted based on Aviation’s cost-recovery model.
§ CATS: In FY 2026, CATS’ fares will remain the same as in FY 2025.
Proposed FY 2026 Financial Partners and Outside Agency Funding
§ Funds 13 Discretionary Organizations with the Financial Partner Program for a total of nearly $2.3 million to advance all five of City Council’s Strategic Priorities
§ The FY 2026 recommended budgets for Charlotte Center City Partners, University City Partners, and SouthPark Community Partners Municipal Service Districts #1-6 support economic, cultural, and social development within designated districts. Their allocations are based on the valuation of properties in their respective districts.
- The Proposed FY 2026 tax rate in Municipal Service District 2 (Center City) includes a 0.82¢ increase from the FY 2025 Budget, for a total rate of 3.00¢ per $100 assessed valuation.
- The Proposed FY 2026 tax rate in Municipal Service District 3 (Center City) includes a 0.82¢ increase from the FY 2025 Budget, for a total rate of 4.14¢ per $100 assessed valuation.
§ The Charlotte Regional Visitors Authority’s budget reflects an increase of 2.6 percent over FY 2025.
Proposed FY 2026-2030 Capital Investment Plan (CIP)
§ The five-year total Proposed FY 2026-2030 CIP is $5.34 billion (this includes the total General CIP, as well as the five-year capital plan totals for nongeneral departments: Aviation, CATS, Charlotte Water, and Storm Water).
§ The five-year General CIP totals $651 million (this includes general obligation bonds, other sources, reappropriation of prior authorization, and PAYGO funds).
§ The nongeneral departments’ five-year capital plans total $4.72 billion and are summarized below:
- Aviation totals $1.7 billion, an 11.9 percent decrease,
- CATS totals $331.6 million, a 15.9 percent decrease,
- Charlotte Water totals $2.3 billion, a 1.6 percent increase, and
- Storm Water totals $425.0 million, a 2.5 percent decrease.
§ The Proposed FY 2026-2030 General CIP includes:
- Continuing the multi-year program to construct and renovate Fire facilities;
- Dedicating $3 million in FY 2026 and $11 million over five years towards an ongoing radio replacement program to ensure critical public safety communication infrastructure is replaced regularly;
- Supporting expansion of the 911 Call Center in Police headquarters and the Police and Fire Training Academy with $2 million in funding in FY 2026 for a total investment of $9 million;
- Continuing to implement the Americans with Disabilities Act Transition Plan in city-owned facilities;
- Providing funding to ensure well-maintained and efficient city-owned facilities, including roof, window, and door replacements; and
- Reserving $7.5 million in FY 2026 for a satellite Animal Care and Control adoption facility that remains in the Advanced Planning and Design Program.
Budget Process
§ The following is the Council-adopted remaining budget meeting schedule:
- May 19 - Budget adjustments,
- May 29 - Budget straw votes, and
- June 9 - Budget adoption.
§ State law requires local governments to adopt a budget by July 1 of each year.
§ A complete copy of the proposed budget is available online at: https://charlottenc.gov/budget/Pages/default.aspx
Attachments
Attachment(s)
Proposed FY 2026 Budget Presentation