Asheville council sees tax-rate math for budget gap ahead

A revenue-neutral rate sounds like a freeze, but Asheville homeowners can still end up paying more. On a $300,000 house, Asheville’s current city levy at 44.19 cents per $100 comes to about $1,325.70 a year, and each extra penny on the city rate adds about $30 more.

That is the math Asheville City Council began seeing as it looked at the next budget and the new Buncombe County reappraisal. Countywide property values are being reset to fair market value as of Jan. 1, 2026, the first reappraisal in five years, and North Carolina law requires local governments to calculate and announce a revenue-neutral tax rate after that kind of reassessment. The point is to show the rate that would bring in about the same property-tax revenue as the year before, before any added increase is considered.

City staff told council on April 14 that they had made “a lot of progress towards closing the budget gap,” and Finance Director Tony McDowell said departments had been enlisted to find savings. City staff also said each penny on Asheville’s tax rate generates about $2.75 million in revenue. The city has since narrowed its projected general fund gap from about $30 million to about $10.5 million ahead of the final budget proposal.

That matters because even a small move above revenue neutral would land directly on household bills. A six-cent increase above that level would add about $150 a year to a $250,000 home, about $180 on a $300,000 home and about $240 on a $400,000 home. For Asheville residents who also pay the county levy of 54.66 cents and the city school rate of 11 cents per $100, the total local tax load can climb quickly once the city rate moves at all.

The council’s budget choices also come after Asheville adopted a $256.36 million FY 2026 budget on June 10, 2025, which included a 3.26-cent property-tax increase. That makes the current discussion more sensitive for property owners who are still adjusting to the last hike and now face another round of reappraisal-driven tax math.

Buncombe County’s own budget pressure underscores how tight the numbers are across local government. County officials estimated a $41.1 million general fund shortfall for fiscal 2026-27 without a property-tax increase. For Asheville, the decision now is whether revenue neutral will be enough to hold the line, or whether the city will ask homeowners to absorb more to cover services, debt and the next year’s budget gap.