Wilmington City Council FY27 Budget Work Session – May 19, 2026
Wilmington City Council FY27 Budget Work Session – May 19, 2026
The Wilmington City Council held a special budget work session on May 19, 2026, from 8:30 a.m. to approximately 12:30 p.m. (with a lunch break) at the Skyline Center. The session focused on reviewing prior questions and answers from the March work session, discussing the proposed FY27 budget including a 5.75-cent property tax increase, the living wage implementation, and capital improvement projects. No votes were taken; the session was for discussion and direction.
Living Wage and Pay Compression
- City Manager Becky Hawke presented a proposal to implement a living wage costing $14.2 million (4.01 cents of the tax increase). The full living wage would raise the lowest-paid employees from below 60% of Area Median Income (AMI) to between 60–80% AMI. Pay compression concerns were noted: raising only lower-paid positions could cause supervisors to earn less than subordinates. Staff proposed a $15,000 cap on raises to mitigate this.
- Councilmember Cassidy Santaguida requested analysis of lowering the cap to $12,000. Staff agreed to investigate but expressed concern about impacts on senior police officers and firefighters.
- Councilmember Santaguida and Councilmember David Joyner supported full implementation now, stating they did not want to repeat large tax increases annually. Staff noted that future adjustments would be smaller if tied to AMI fluctuations.
Tax Rate and Property Tax Impacts
- The proposed 5.75-cent increase would raise the city property tax rate from $0.2825 to $0.3400 per $100 valuation. For a median-valued home ($445,000), the city-only portion would increase by $256 annually ($21/month). For a $250,000 home, the increase is $144 annually ($12/month); for an $800,000 home, $460 annually ($38/month).
- Mayor Bill Saffo requested a map showing tax-exempt properties (e.g., schools, nonprofits) to understand the tax base burden.
- The approved FY26 tax rate ($0.2825) was revenue-neutral from the 2025 revaluation. The proposed rate would still be lower than the FY25 rate ($0.42).
Sales Tax Distribution and Revenue
- Staff analyzed the impact of Wilmington’s tax rate change on sales tax distribution (calculated via ad valorem method). If Wilmington raises its rate, its share of county sales tax increases, but the change would only affect FY28 (10-month lag). A hypothetical 6.26-cent increase (used for illustration) would yield an estimated $3.7 million more annually, but the proposal is now 5.75 cents.
- Budget Director Laura Mortell reported that sales tax revenue has been volatile post-COVID, with no clear trend. FY24 saw a 2% growth against a budgeted 8%, causing a shortfall. FY25 was flat. Staff remain cautious.
- Mayor Saffo asked about the county’s quarter-cent sales tax (Article 46), which generated $19.4 million in FY26. Staff confirmed it is not shared with municipalities.
Golf Course Operations and Fees
- In FY25, the municipal golf course (Muni) hosted 63,310 total rounds, with 26,984 full greens-fee rounds (25,778 local, 1,206 non-local). Discount card holders accounted for 13,807 rounds (13,004 city residents, 803 non-residents). Nine-hole rounds (Inland Greens) totaled approximately 38,000.
- The budget proposes a $2 increase per round to cover operational needs and capital investments (e.g., electric cart conversion). Councilmember Santaguida expressed concern about subsidizing golfers versus property taxpayers. Mayor Saffo emphasized the need to maintain the course and balance fees.
- Discussion on local vs. non-local pricing: Staff noted that marketing the course to a three-county area (rather than city limits only) helped increase rounds, but Councilmember Santaguida suggested revisiting the policy to ensure city residents receive the greatest benefit.
Capital Improvement Projects and Riverwalk Maintenance
- Projects discussed: Pine Grove South/Greenville Loop Trail Section 4 (design complete, utility relocation starting June 2026); Pine Grove North/Oleander intersection (awaiting re-bid); Wrightsville Avenue sidewalks and roundabout (50-60% complete); Lions Bridge (demolished, awaiting grant).
- Mayor Saffo raised concerns about long-term funding for riverwalk and bulkhead repairs, noting that the riverwalk is a major tourist attraction but maintenance costs are borne entirely by city property taxpayers. He proposed exploring a prepared food and beverage tax (like in Mecklenburg, Wake, Dare counties) to capture tourist dollars. Staff said such a tax requires General Assembly approval and a voter referendum, but the timeline could be 18 months before the next CIP cycle. Councilmember Santaguida supported this concept.
Public Safety Investments and Vacancies
- Police Chief Zuidema presented call volumes: approximately 150,000 calls for service annually, with minimum patrol staffing of 17 officers per shift. He noted staffing challenges: 41 police vacancies, 12 fire vacancies, and 54 other first-responder vacancies (e.g., solid waste, stormwater). The police department has an authorized strength of 280 officers; current deployable count is lower due to training and leave.
- The proposed budget includes $14.2 million for public safety wages and equipment, plus two dedicated IT positions for police/fire technology support. Chief Zuidema defended the assistant police chief position (funded but unfilled last year), stating it is critical for reorganization and service delivery.
- Deputy City Manager Mary Vigue outlined a new mental health program for first responders at a recurring cost (amount not specified in the transcript). Councilmember Santaguida expressed support.
Council Pay and Organizational Structure
- Councilmember Santaguida proposed eliminating the 2027 pay raises for council members (approximately $3,000 each). Councilmember Joyner agreed, noting that the position is not designed as a full-time job. Mayor Pro-Tem Kevin Spears said he could support that if the city also eliminated the assistant city manager and assistant police chief positions and paused high-level hiring. City Manager Hawke defended both positions as necessary for organizational effectiveness.
- The assistant city manager salary is expected to be around $190,000 (less than the deputy city manager positions). The assistant police chief position was funded in FY26 but never filled; Chief Zuidema stated it is now needed.
Lobbying and Legislative Affairs
- Staff explained that two lobbying firms (Upward Strategies LLC and EQV Strategies LLC) are contracted for $96,000 annually, focusing on city legislative priorities. Councilmember Joyner questioned the value and requested monthly reports on activities. Assistant to the City Manager for Legislative and Community Affairs Kara O’Malley confirmed daily communication with lobbyists and offered to provide regular updates. Mayor Saffo noted the importance of lobbying for defensive issues (e.g., blocking legislation that would reduce local control). Councilmember Joyner’s request for monthly reports was accepted.
Parks Maintenance and Facilities
- A presentation covered the new Asset and Property Maintenance Department ($27.8 million budget, 100 positions). Landscape services maintain 744 acres, 47 parks, 30 miles of trails. Issues with restroom vandalism were highlighted; staff are evaluating park-specific solutions. Capital maintenance for parks is funded at $3.7 million in FY27.
Key Outcomes
- Direction to Staff: Analyze the impact of reducing the living wage cap from $15,000 to $12,000 and report back.
- Direction to Staff: Provide a map of tax-exempt properties within city limits.
- Direction to Staff: Request from New Hanover County a breakdown of property tax appeals outcomes (value and type).
- Direction to Staff: Begin exploring a prepared food and beverage tax to fund riverwalk and tourism-related infrastructure.
- Direction to Staff: Provide monthly reports on lobbying activities and outcomes.
- Direction to Staff: Investigate the history and rationale of the city providing four school resource officers at specific high schools.
- No Formal Vote Taken: The work session was advisory; final budget decisions will occur at subsequent meetings.
Meeting Transcript
We'll bring this City Council special meeting for budget work session Friday, May 15th at 8 30 a.m. at the beautiful Skyline Center to order. At this time, I'm going to take a roll call. Mayor Pro Tem, are you here? Oh, yeah. Council Member Join, are you here? Councilmember Andrews, are you here? Councilmember Lau, are you here? Councilmember Santa Guido, are you here? Here. Councilmember Clinton Quintana, are you here? But you're here. And the chair is here. Everybody's here and accounted for. So at this time, I'm going to turn it over to our city manager, Ms. Becky Hog, Ms. Hall. Thank you, Mr. Mayor, Mayor Pro Tem members of Council. Appreciate everybody's time on this Friday morning to talk about the FY27 budget. Before we dive into those details, I do have a couple of introductions that I want to point out some folks in the room who you have not had the opportunity to meet yet. When I call your name, if you wouldn't mind just uh standing and waving, um, but our new um director of safety and risk management, Jason Eves. I saw him walk in a minute ago. Uh Jason comes to us from Brunswick County prior, um, so just across the river. Um he's been with us for a little while now, already doing a great job. Heather Cashwell is our uh director of recycling and trash services, solid waste services. Um has a great background. Uh, we put out the press release not too long ago, um, but she has been the head of SolidWay Services for other municipalities, and she comes to us most recently from the state of North Carolina DEQ. Um, and then uh you have not uh seen the announcement yet, but she was here uh meeting with staff and getting to know folks. So Robin Slade is our uh director of um uh property and um asset maintenance, and um she is going to be starting on June 1st. Um, and she comes to us from CMS where she was over 18,000 employees that that you supervise there. So um uh so as big as that department is, it is um actually a very scaled down version of uh what she uh was used to previously. So um uh fantastic new folks that we have added to the rest of our wonderful staff as we move the organization forward. So uh we have a lot of information that we want to review with you today to um to make sure that the information that has been emailed out is understood, that there's no additional questions on it. Um of course we want you to stop us along the way and ask questions or ask for clarification, and then further on in the morning, we have um just some open time for discussion to hear from you all about what else is on your mind and what other questions we can gather answers for you and uh continue the discussion at our next work session. So, with that, uh we want to get started by reviewing some of the prior questions and answers that were submitted that uh were actually uh posed in our last time together back in March, um, but want to again just review those, get them into the record, and um make sure that we don't have any questions. Um so we'll wait and get that pulled up. So if we can actually start with the one that I believe is dated um uh dated the May 12th would be the first one. Yes, that one, thank you. Okay, um, so the the first uh was a request to just provide job descriptions for the new positions that were created as part of the reorganization. I believe there's a hundred and thirty pages of job descriptions uh that were submitted to you, so um feel free to peruse those at your leisure. If you have any questions about those positions, let us know. We also um wanted to provide the current and proposed living wage pay rates by position that included title title, current pay, and adjusted pay, along with an overview of the pay compression challenges facing the city. Um you um look at the pay compression. Um part of the reason why we are looking to move the entire uh pay scale is uh because um if you were to stop at a certain point, then um the positions that are um kind of towards the top of that stopping point would then potentially be getting increases that are higher than people who are already higher up the pay scale. And a lot of times um that is uh right at the line of demarcation between a supervisor and somebody that they are supervising. And so if you give a bigger raise to the person lower down the scale, and we we ran these scenarios and watched it happen, it would actually pop those lower ranking employees above their supervisors, or it would bring their pay so close that essentially there's there's no financial acknowledgement or incentive to be taking on those additional responsibilities, the additional jobs of management and asking them to do that work. At the same time, we are proposing right now a cap of no more than $15,000, regardless of your pay, because we didn't want to apply these same principles to people who are higher up the pay scale, even though it is a much smaller percentage of our staff. If you were to apply a 19 or 20% across the board increase, you start applying that to large pay amounts, and that becomes kind of an exponentially large pay increase that we didn't feel was necessary or appropriate, and we felt that it would send the wrong message about what we're trying to accomplish here, which is really about driving the dollars down the pay scale to the lowest paid members of staff. So we can certainly get into more detail, but if we could scroll to the end, I just want to show because we did some color coding just to help illustrate if we could go to that appendix.
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