Valdese proposes tax hike, fee increases address rising expenses

Editor’s Note: This is the first of two stories detailing the emerging Valdese budget designed to combat rising costs and soaring needs. More coverage is planned for the April 25 edition.

Valdese residents may soon pay hundreds of dollars more in taxes and fees each year as part of a budget strategy to close a growing budget gap driven by rising costs and long-term infrastructure needs.

Council members and Valdese staff spent about five hours in the town hall’s community room on Tuesday weighing how to preserve services, retain employees, and prepare for long-term needs, including a planned public safety building for the police and fire departments.

The proposed budget totals $8.9 million and is designed to erase a projected $428,908 deficit. Town officials said the increase is needed to keep pace with higher employee pay, retirement costs, law enforcement retirement increases, medical insurance premiums, maintenance of aging facilities, and inflation in equipment, materials, and services.

Central to the budget strategy is a proposed 13-cent property tax increase, raising the rate from 41.5 cents to 54.5 cents per $100 of valuation.

For a home valued at $344,900, the median listing price of a Valdese home in March, the homeowner’s property tax bill would rise from about $1,431 to $1,879.

Chief Financial Officer and Assistant Town Manager Bo Weichel said during the planning session that financial projections from Tryon Investments showed the current 41.5-cent tax rate is not sustainable. Tryon Investments was hired by Valdese to assist with financial planning.

Valdese “can’t sustain this (41.5 cents property tax rate), even in the short term,” Weichel said.

By raising taxes and the price of select services, coupled with elimination of some proposed capital projects, the 2026-27 budget can be balanced with exactly $8,915,829 in revenues and expenditures.

Officials said this proposal resets the property tax rate to what it was for most of the last decade, until the 2024-25 fiscal year, when it was lowered to 51.5 cents. It was lowered another 10 cents for the 2025-26 budget, dropping to 41.5 cents.

WHAT’S GOING UP

The proposed budget includes a new 13-cent fire district tax. Officials said the fire tax would generate about $742,338 in additional general fund revenue and could help support future debt tied to the public safety building project.

Weichel said that because the tax is tied to fire-related services, it could later be adjusted when debt tied to that project comes off the books.

Valdese did not have a fire district tax previously.

Residents would also see a 7% increase in water and sewer rates under the proposal. Town Manager Todd Herms said the average residential water customer would pay about $2.80 more per month, while the average sewer customer would pay about $1 more.

Trash collection fees would also rise. Monthly residential trash service would increase by 75 cents to $10.75. Small-business trash service would rise by 75 cents to $16.05. Construction debris disposal would increase by $25 to $125 per load. Residential recycling would remain unchanged at $4.30.

Weichel said the increases would help cover what Simply Green Recycling & Waste charges the town for those services.

Paired with adjustments on taxes and service fees, staff proposed multiple budget cuts to prevent a deficit, including the postponement of repairs at Tiger Gym, reduced employee work hours, and suspending the Main Street Facade grant program that helped downtown business owners improve their storefronts.

The cuts, Weichel said, “are not ideal situations, but they were designed to have the most minimal impact on our operations as possible.”

OTHER INCREASES

Renting space at the Old Rock School would also increase, affecting all businesses and organizations using space at the building. This includes Old Colony Players and Rock School Arts Foundation, which were previously not charged to use space in the building. Each would now pay $3,600.

The price hikes are based on how many square feet each business and organization uses, Weichel said, which helps “get everybody on the same playing field.”

Valdese Economic Development Investment Corporation (VEDIC) and Tranquility Day Spa would pay $4,700 to lease space, a $284 increase. Dream Connections would pay $3,000 more, totaling $14,000.

Piedmont & Western Railroad Museum, Meals on Wheels, and Rotary Club would pay $3,600, representing a different increase for each. The museum would pay an extra $840, Meals on Wheels would pay another $600, and Rotary Club would pay $2,095 more.

Weichel noted that every business and organization renting space at the Old Rock School gets electricity/gas, Wi-Fi, water, shared restrooms, security, janitorial supplies, and trash and recycling collection as benefits with no extra charge.

Bowling alley fees are also proposed to go up. Renting a lane would go from $20 to $25, including shoe rentals, for up to five players in each lane.

Game rates would increase a small amount, going from $3 for a game to $4 for a game. Shoe rentals remain $2, and special needs games and rentals would stay $2.50.

Increasing the rates would help fund bowling alley maintenance, Weichel said.

The proposed budget will be presented at 5 p.m. on May 11 in Town Hall before the town’s regular meeting at 6 p.m.

Originally, a public hearing was scheduled for June 1. The meeting will, tentatively, happen on May 28, Herms said, but the council must vote to move the date at the May 11 meeting.

Tentatively, the public hearing for the proposed budget will be on May 28 at 6 p.m. in Town Hall.