Title
Public Hearing on Municipal Service District 5 Millage Rate Increase
Action
Action:
Conduct a public hearing on the proposed Municipal Service District 5 millage rate increase.
Body
Staff Resource(s):
Alyson Craig, City Manager’s Office
Shahid Rana, Economic Development
Policy
§ State law allows cities to create municipal service districts (MSDs) to promote economic development and/or provide services at a higher level in the district than provided for the entire city.
§ Urban development/redevelopment areas are one of the municipal services for which a district can be created.
§ MSDs are funded through an assessment on all property owners within the district boundaries. All the money raised by the MSD assessment must be spent on district enhancement programs.
§ In accordance with NC General Statute Section 160A-536, projects funded through MSD revenue may include (but are not limited to): expansions/improvements to support utility provision, street lighting, streets and sidewalks; construction of pedestrian and bicycle paths, construction of public buildings, improvements to relieve traffic congestion, improvements to reduce the incidence of crime, providing city services or functions in addition to or to a greater extent than those provided for the entire city, sponsoring events, promoting business investment and economic vitality, coordinating public private partnerships, and marketing support.
§ City Council adopted a policy, Municipal Service District: Property Owner Engagement Policy, effective October 14, 2019, which requires a public hearing prior to decisions on MSD millage rate increases.
Explanation
§ MSD 5 was established in 2003 and is operated by University City Partners.
§ The current MSD 5 boundary follows property lines and includes properties between the Highway 29/49 connector off Interstate 85 on the south, the rear property line of parcels on the west side of Mallard Creek Road on the west, Mallard Creek Church Road and some adjacent commercial properties on the north, and the rear property line of parcels on the east side of Highway 49 on the east.
§ The current millage rate for MSD 5 is 2.62¢ per $100 valuation. University City Partners has requested approval for a millage rate of 3.80¢ for FY 2027, a 1.18¢ increase from FY 2026.
§ Council received information about the potential millage rate increase on January 29, 2026.
§ On March 5, 2026, the Budget, Governance, and Intergovernmental Relations Committee received an overview of the potential millage rate increase.
§ A millage rate increase for MSD 5 was included in the Manager’s Proposed FY 2027 Budget, which was presented on May 4, 2026.
§ Council will consider approval of the proposed millage rate increase as part of the FY 2027 Budget Adoption on June 8, 2026.
Community Input
§ University City Partners utilized a mix of outreach methods to ensure diverse participation including listening sessions, public information sessions, digital outreach, and informational postcards.
§ Key outcomes of engagement efforts include over 19,453 emails sent, 2,094 postcards mailed, 240 outreach surveys completed, and 286 in-person outreach interactions with rate payers.
Attachments
Attachment(s)
Map