CHARLOTTE, N.C. -- In a stunning decision, the Charlotte City Council narrowly rejected Monday a nearly $1 billion capital plan, as four Democrats joined two Republicans in objecting to the 8 percent property tax increase to pay for it.
City Manager Curt Walton has lobbied for the capital plan this year, saying the city must do more to improve low-income neighborhoods. He has said the city’s current financial path — in which south Charlotte pays for half of the city’s property taxes — is “unsustainable.”
In the months leading up to Monday’s vote, only the council’s two Republicans voiced significant opposition to the tax increase. But during Monday’s meeting, after a weekend of intense lobbying, Democrats Michael Barnes, Patrick Cannon, Beth Pickering and Claire Fallon voted no with Republicans Andy Dulin and Warren Cooksey.
The decision shocked Democratic Mayor Anthony Foxx, who supported the plan.
He said the vote was “perhaps the most irresponsible decision in council history.”
Foxx later said: “We have just become Washington, folks. Frankly, it’s disgusting.”
Council members said they couldn’t remember the last time they rejected a manager’s recommended budget.
The city doesn’t have a budget for the upcoming fiscal year, which begins July 1. The city must have a budget and a tax rate by June 30. Council members voted to send the issue to the budget committee.
It would have been the city’s third tax increase in 25 years, and the first since 2006.
“If you give me two years and the economy improves, I have no problem (with the tax increase and plan),” Fallon said.
In some ways, Walton’s plan is similar to past capital programs, with much of the $926 million slated for basic infrastructure like roads, sidewalks and bridges. But Walton’s plan also calls for money to be spent on big-ticket items designed to spur development.
There is $119 million for a streetcar. The city set aside $25 million to renovate Bojangles Coliseum into an amateur sports center, as part of a $60 million makeover.
During the council’s scheduled budget meetings — in which projects are scrutinized — there were no significant objections to those controversial items among Democrats.
The increase would have raised the city’s property tax rate to 47.3 cents for every $100 of taxable value, up from 43.7 cents. The owner of a home valued at $200,000 would have paid an extra $72 a year in city property taxes.
Supporters of the budget, including Democrat David Howard, noted the impact would have been lessened due to Mecklenburg County’s recent decision to lower its tax rate by 2.44 cents.
“It’s a less than 1 percent increase,” Howard said.
Democrat John Autry added: “It’s time to repave the streets, time to reconfigure our assets. If we leave a legacy behind us, it’s that we were willing to step forward and invest.”
Democrat James Mitchell said the capital plan is “bodacious, it’s big” and should be supported. He said the city has historically had a “can-do” attitude.
But at a public hearing in late May, numerous residents urged council members to reject the capital plan and tax increase. That apparently unsettled enough council members, who rejected the plan.
There are other city rate or fee increases that have been proposed. The Charlotte Area Transit System is raising the price of a bus and train fare. There is a proposal to increase water and sewer rates, along with stormwater fees.
Barnes had been an ardent supporter of the plan’s goal to reinvest in struggling areas. But during Monday’s meeting he asked city staff skeptical questions about the streetcar, and how the city would pay for the train’s operating costs.
The city had planned for a 3 percent wage increase for city employees. It also planned to offer benefits for same-sex partners for the first time.
Those two items haven’t been decided yet.