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Over the last week or so, News Director Ben Schachtman and I asked every council member to come in and chat about what they want to see in this year’s budget.
Until recently, they’ve largely played their cards close to the vest in public meetings, just asking questions here and there about City Manager Becky Hawke’s proposed 20% tax increase, largely aimed at giving city staff a living wage and catching up on capital projects.
The ‘living wage’ plan would set a salary floor of $45,000 a year for the lowest-paid workers, based on 60% of the region’s area median income.
That would be a 20% increase for the lowest wage employees, and – to prevent compression of salaries (low-level employees edging up to or jumping over the salaries of their supervisors) – also a 20% bump for all salaries up to the Area Median Income of $75,000 a year. To prevent costs from escalating out of control, Hawke instituted a $15,000 salary-increase cap for those employees making more than $75,000.
The plan requires a significant investment – which is to say, a significant tax increase: 5.75 cents, or around an additional $260 in taxes for a median household.
There are several arguments in favor of this proposal: it would help with retention for lower-paid employees, particularly in the police and fire departments. It would incentivize higher-wage employees to continue at the city and pursue promotions. And it would simply be a good thing to pay employees, especially those struggling at the lower end of the compensation ladder, a wage that would allow them to survive and even thrive in this rapidly changing city.
Arguments against, largely coming from frustrated taxpayers and business owners, are that it’s a very substantial increase for anyone to get a 20% bump to their wages in a year, that it pushes a lot of employees above the comparable wages for similar jobs in the private sector, and that it’s not a good time to raise taxes, given economic pressures already causing an affordability crisis for regular residents in Wilmington.
For weeks since this proposed budget became public, we’ve mostly heard arguments from staff about its merits, criticism from the outside, and little discussion by council members. Privately, some members told me they wanted to get all their questions answered before weighing in.
But now, after an eight-hour budget work session on Friday, Wilmington’s city council managed to shave a small amount off the proposed 5.75-cent tax increase.
It was a negotiation with very little wiggle room. Most of the council members wanted to see a stricter limit for the tax increase, but there was very little they wanted to give up.
The proposal they landed on for a vote this coming Tuesday increases the tax rate by 5.5 cents to 33.75 cents per $100 in property value, which is a 19.5% tax increase. That’s despite some efforts to pare it back more; Councilmember Kevin Spears said he’d like to see a rate more in line with 2-3 cents, and with Councilmember David Joyner saying he’s “a yes at 4.9.”
That modification came from lowering the wage increase cap to $12,000 for every department except police and fire, which still got the higher $15,000 cap. That change saved .14 cents of the tax rate. The rest came from little modifications here and there: getting rid of appropriations for AI, reducing the tech fund, and using the fund balance to cover the cost of mission-ready gear for first responders.
City Council and staff went through the entire budget, line by line. When one staffer offered up surveying equipment that could go a few more years before replacement, Councilmember Chakema Clinton-Quintana said, “I owe you lunch.”
While no final decisions have been made yet, the rest is apparently staying in, including a $3,000 increase to the salaries of city council members.
Some members had suggested removing their increase this year as a measure of goodwill. But Clinton-Quintana pointed out that her councilmember stipend, a roughly $23,000 wage, is currently her only income.
“So, if you want to talk about who's living in poverty: potentially one of your council members," she said.
Spears agreed with her, noting that a study years ago showed that Wilmington’s council is deeply underpaid compared to other municipal elected officials in the state. The rest of the council acquiesced.
On the big ticket items, different members of council all wanted to keep things the way they were proposed: massive investments in capital projects to deliver on long-held promises, like the Kerr Avenue Trail, a multi-use path on Hinton Avenue, and intersection improvements on Pine Grove Drive at Greenville Loop Road.
In an interview ahead of the budget negotiations, Council member Cassidy Santaguida said there’s a lot changing at the city, calling it a “new era.”
“We're changing a lot as a city […] I think now that we also have new leadership in place in a variety of positions, I think we're recognizing change is inevitable, and evolving as a city is inevitable,” she said.
That involves these efforts to improve staffing at the city, changes in leadership from council to the manager to individual departments, and an emphasis on quality of life for staff and residents alike.
Each council member who spoke with WHQR highlighted their priorities: JC Lyle said hers was public safety, especially on equipment and salaries. David Joyner said he wanted to see Capital Improvement Projects to completion and supported the living wage. Salette Andrews highlighted the living wage proposal, the CIP, and also her goal of providing additional shelter for the homeless population in Wilmington.
Andrews noted the city and county’s plans for addressing homelessness from 2024.
“The strategy to address unsheltered homelessness, unfortunately, that's never been funded, it's never been budgeted,” she said. “We have no timeline.”
Staff discussed that plan at the budget meeting as well: it would cost $26 million to fully implement, and there still is no timeline for it. We’ll have more on the specifics of the housing conversation next week.
But one final note before we head into the public hearing and the vote this week: Former councilmember Luke Waddell penned a critical op-ed on the proposed budget, and highlighted promises to sell off city properties to pay down debt service for the new Skyline Center.
“The adjacent riverfront tracts, marketed to serious buyers at prices that would have generated tens of millions of dollars, sit unsold and off market. Their potential contribution both to Wilmington's tax base and infrastructure fund is apparently no longer part of the plan. No one in city leadership has explained why. No one on the current council has pressed them to,” he wrote.
City Manager Becky Hawke addressed that criticism during the budget work session on Friday.
“The purchase of Skyline Center Campus is in no way causing the proposed tax rate increase,” she explained. “The city initially paid $68 million for the campus, and we are over five years ahead of schedule in paying off all of the debt associated with that purchase.”
The city cannot pay any of its remaining debt off early, because it’s not callable. The remaining debt is about $40 million.
As for selling off the properties near the Skyline Center, there’s a reason they haven’t done that yet, Hawke said.
“Last year the city did go through a process of considering the sale of one of its parcels, we received a number of proposals, but all of them were under the appraised value of the property by a couple of million dollars, and all of them included a significant component of market rate luxury apartments that we did not think was the highest and best use of that property at that time,” she explained.
On top of that, parks and rec staff have said they need to evaluate future needs for the Live Oak Bank Pavilion, because it may not have enough on-site storage right now.
“So before we sell the one parcel that we still have control over next to the park, we want to make sure that we can fit everything that we need to on the park,” she said.
City Council has a lot to consider at its next meeting: the public hearing on the budget will include a vote. At the initial budget presentation, just a handful of people spoke up about the budget: a few regular citizens against the tax increase, one engineer with the city’s fire department, representing the firefighters’ union, in favor.
Council meets to discuss the budget at 6:30 p.m. on Tuesday at the Skyline Center
