Raleigh’s city officials have rolled out a proposed $1.78 billion budget for the fiscal year 2026 that appears to avoid tax increases while focusing on the City’s workforce and strategic investments. Notably, City Manager Marchell Adams-David has put forth this budget recommendation, keeping the property tax rate stagnant at 35.50 cents per $100 valuation. According to details released by City of Raleigh officials, the operating budget for the General Fund is pegged at $657.1 million.
The FY26 budget does not shy away from investments, earmarking substantial funds to a classification and compensation study that seeks to align employees’ job descriptions and salaries more closely with market standards. Despite the rising cost of City services, it manages to propose a budget with no tax increase by planning strategically. To ensure Raleigh’s commitment to offering top-tier services, it includes investments in areas like Dix Park, cyber security, and a second fire academy.
Focused on capital projects, the budget designates $616.9 million to various initiatives including affordable housing, parks operations, street maintenance, and pay-as-you-go projects. These projects, importantly, function independently of bond funding. The larger five-year Capital Improvement Program encapsulates a substantial $2.5 billion for the time span of FY2026 to FY2030, intending to address the city’s growth and infrastructure requirements progressively over time.
Adams-David also explained the city’s adoption of a “Steady State” financial model that aims to offer greater flexibility in planning and executing essential capital projects. This model allows for direct revenue contributions to the Debt Service Fund, rather than funneling through the General Fund, according to the budget presentation made available by the City of Raleigh’s announcement. Even in the face of an economic downturn, with a notable flattening in sales tax collections, the City has not increased taxes, while general fund expenses saw a decline of 10.3%.
Wrapping around the theme “Our Greatest Asset: Our Workforce,” the proposed budget also puts forward a radical classification and compensation study. Affecting over 7,000 city employees across more than 450 job types, this study necessitates $35 million for its full implementation. The City had prudently set aside $11.4 million in FY25 in anticipation of this overhaul, demonstrating a blend of foresight and fiscal discipline that continues to ensure Raleigh’s financial solidity, as per the City of Raleigh’s announcement.
