Faced with a $12 million budget deficit, Asheville residents can expect to pay higher property taxes after the City Council voted 5-2 on Monday morning to raise them 4.2% for the upcoming fiscal year, according to city records. The decision will cost homeowners in the greater Asheville area an average of $180 more per year, according to estimates. Effective July 1, 2026, the tax hike has sparked debate about economic pressures amid inflation and a slowing job market, according to some economists. Local business leaders fear it could further strain purchasing power and small business viability in Buncombe County.
According to Buncombe County Government officials, the budget shortfall stems from $8 million in unreimbursed storm recovery costs from the 2024 floods and a three percent drop in hotel occupancy taxes. The tax increase applies to all properties in Asheville and, according to county officials, extends to some unincorporated areas through county coordination. The city plans to allocate $5 million for road repairs and $3 million for public safety staffing, addressing what city officials attribute to a 15 percent rise in emergency calls.
WLOS News 13 reported that more than 300 protesters attended the public hearing, as opposition from council members centered on the potential impact on low-to-moderate income households, which according to city data number more than 25,000. The Asheville Citizen-Times reported that the decision occurs amid broader economic challenges in Western NC, including what state data show is a 0.2 percentage point unemployment uptick in Buncombe County, which stood at 4.8 percent in the most recent data, tied to tourism dips and supply chain issues. A proposed state bill in Raleigh seeks to cap local tax hikes, potentially overriding Asheville's increase if passed. Negotiations with Duke Energy are also underway for potential rate relief on utility bills.