Raleigh City Manager Marchell Adams-David presented her $1.78 billion budget proposal for fiscal year 2025-26 to the city council on Tuesday. Highlights include significant pay raises for city staff and investments in affordable housing and Dix Park.
The proposal does not include a property tax increase—rates will remain the same at 0.35¢ per $100. It does include slight fee increases for solid waste, water and sewer, and stormwater services, amounting to an additional $4.33 per year for the median Raleigh household.
The proposed budget represents a 25 percent increase over the current fiscal year budget of $1.43 billion, largely because the city is including bond proceeds in its funding totals for the first time. With the previous methodology that excluded bond proceeds, this proposal would represent only a two percent increase over the previous fiscal year.
Despite the unusually high top-line figure, this year’s proposed budget involves some belt-tightening on Raleigh’s part in response to slower growth and “vast economic ambiguity,” as Raleigh’s director of budget and management services Sadia Sattar put it to the council on Tuesday.
Property tax revenue, the city’s single biggest funding source, is projected to grow by only 1.95 percent this year—much less than last year’s 16.6 percent growth. The city’s sales tax revenue is expected to decline by 0.5 percent over last year because of lower consumer confidence brought on by federal funding cuts and changes to tariff and trade policies.
To offset the slowdown in revenue growth, Adams-David and city staff found $3.2 million in proposed savings across departments and recommended that six vacant, full-time positions be eliminated.
One of the few areas where the city decided to make new investments—as opposed to simply preserving the status quo—was staff compensation. A recent compensation study revealed that City of Raleigh employees earn far less than their peers in comparable cities—about 86 percent of the market average at the minimum pay ranges and about 93 percent at the maximum pay ranges.
To make city worker pay competitive, the budget proposal allocates $35 million to raise full-time employees’ pay by nine to 11 percent. Part-time employees would get a 5 percent pay bump. All police, fire, and emergency communications staff would receive the maximum 11 percent raise. Starting pay for some city jobs, like emergency call-takers, would rise by more than 11 percent to bring them into the city’s updated pay structure. If approved, the salary adjustments will take effect in September.
Adams-David’s budget allocates $11.7 million for Dix Park, divided across Gipson Play Plaza programming, building demolition, and grounds maintenance.
There’s also $23 million set aside for affordable housing. Half of that total comes from a designated portion of tax revenue for affordable housing, and the other half represents the remainder of the 2020 bond funding. The money will go towards public-private partnerships, gap financing, rehabilitations, and down payment assistance.
The proposed budget does not include separation allowance for Raleigh firefighters, a retirement benefit they have been seeking for years. (The city has long struggled to retain workers for the high-risk, relatively low-paying job.) It does, however, raise firefighters’ starting pay from $51,194 to $56,825 and allocate $1.3 million for “operational and personnel increases” within the department.
Other notable line items in the city manager’s proposed budget include:
- $31.3 million for stormwater improvements around the city.
- $11.6 million for street resurfacing and maintenance.
- $3.24 million for improvements across Raleigh’s parks system.
- $2.2 million (in addition to previously committed funds) to expand the Raleigh Convention Center and relocate Red Hat Amphitheater.
- $1.58 million for multiple greenway improvement projects.
- $1.5 million for improvements to the Martin Merritta Performing Arts Center.
- $750,000 for “advance planning efforts” at Nash Square.
- $600,000 to pave currently-unpaved streets.
- $100,000 to replace Boarddocs, the platform the city uses to archive city council materials.
You can read the budget proposal in its entirety here and a condensed version here. Residents will have the opportunity to comment on it during a June 3 public hearing in city council chambers. The council will adopt a budget by June 30.
Chloe Courtney Bohl is a Report for America corps member. Follow her on Bluesky or reach her at [email protected]. Comment on this story at [email protected].