The new fiscal year begins next week on July 1, and each of Orange County’s local governments successfully approved their operating budgets and tax rates before that deadline.
Amid a year with a variety of external factors — property revaluation, significant funding cuts by the federal government, housing pressures and school district needs — the three town governments and county spent weeks analyzing their current finances and projections, hearing public comment and working with their staff to determine a path forward. Here are the final totals for the budgets, the property tax rates for each community, highlights from the packages and comments from the elected leaders.
Orange County
Total budget: $306.04 million (4% increase from FY25)
Approved property tax rate: 63.83 cents per $100 of valuation (22.51 cents less than FY25 rate)
Amount above revenue-neutral rate: 1.19 cents
Board Vote: Unanimous (7-0)
Notable details:
This spring’s property revaluation cycle hit many Orange County homeowners with significantly higher values. As such, the Orange County commissioners aimed to lessen the impact of their own taxes without greatly affecting services and still pushing forward on long-term investments. The result was a budget with a slight increase in its total amount and a property tax rate negotiated down from the manager’s recommended 2.95 cents above revenue neutral.
For schools, the county increased funding for Chapel Hill-Carrboro City Schools ($8,560 per pupil, up $343) and Orange County Schools ($5,877 per pupil, up $211) while allocating $20.84 million to debt service for school-related infrastructure projects. Orange County also boosted its operating support for the Durham Technical Community College campus in Hillsborough, adopted a living wage for permanent county employees and increased allocations to both the Emergency Housing Assistance and Long-Time Homeowners Assistance programs.
Comments by the Chair:
Jamezetta Bedford, who chairs the Board of Commissioners, told 97.9 The Hill she is proud of the county’s ability to “hold the line” against significantly raising taxes for residents while maintaining its commitments to the community’s values and Orange County’s various projects. She also credited her colleagues for working through their differences through the deliberation and amendment processes this spring.
“This budget reflects the county’s commitment to strong public education, essential social services, and a competitive wage for our employees – all while maintaining a fiscally responsible reserve and minimizing the tax impact on our residents,” said Bedford. “Our goal is to continually support both opportunity and equity across Orange County.”
The full, approved Orange County budget for FY2026 can be found on the county government’s website.
Chapel Hill
Total budget: $164.1 million (4% increase from FY25)
Approved property tax rate: 50 cents per $100 of valuation (9.2 cents less than FY25 rate)
Amount above revenue-neutral rate: 5.8 cents
Council Vote: 5-2 (Anderson, Ryan against; Searing and Stegman also previously voted against the budget, but were absent on June 18)
Notable details:
The Chapel Hill Town Council continued the local government’s efforts to increase its employee pay to a competitive market rate, while also increasing funds to cover deferred maintenance to town facilities and street resurfacing projects. The budget also shields the town from most of its federal funding hits — covering grant losses for its Crisis Assistance, Response, and Engagement (CARE) positions in the Police Department and maintaining the fare-free Chapel Hill Transit service while slightly increasing pay and its capital needs.
Comments by the Mayor:
In a rarity, the Chapel Hill mayor was part of the council voting against the final proposed budget. Jess Anderson shared throughout budget negotiations concerns of how residents in a community deeply impacted by federal funding cuts could afford an expansion budget. Ahead of the vote to approve on June 18, she said the decision has less to do with any of the initiatives or efforts in the budget, but simply how much they cost and the timing.
“Moving forward,” Anderson said, “I think that we have to reconcile ourselves to the fact that we’re in for a few more bumpy years, at least, and we can’t make up for all the cuts that we’re experiencing by raising property taxes on people. I want us to be smart and I want us to be strategic, focusing on the most critical things to do and looking for ways to work within the money we have — even if it means doing less. And I know there would be folks in the community who would be disappointed if we cut back on the amazing services we offer.
“It brings me no pleasure to not be able to vote for this budget,” she added, “because there’s a lot of really important things in there. But that’s the decision I’ve come to — and I deeply respect the decision my colleagues have made that may differ from mine.”
The full, approved Town of Chapel Hill budget for FY2026 can be found on the town government’s website.
Carrboro
Total budget:$62.5 million (10% decrease from FY25)
Approved property tax rate: 56.53 cents per $100 of valuation (3.91 cents less than FY25 rate)
Amount above revenue-neutral rate: 9.72 cents
Council Vote: 6-1
Notable details:
Carrboro saw some spending come off its books this year as capital projects finished up and several grants and ARPA contributions ended. But the property tax rate going higher above the revenue-neutral limit was out of necessity to not pull further from the local government’s fund balance to cover essential services and renovation of town facilities, according to staff. The measure also maintained Carrboro’s portion of Chapel Hill Transit contributions, added 5% raises for town employees and increased its affordable housing special revenue to 2% of the tax rate to help fund projects. Next year, however, will likely require some changes — as the town manager warned that Carrboro’s fund balance will be drawn down to just $6 million in reserves and will face either scaling back services or further raising taxes.
Comments by the Mayor:
Mayor Barbara Foushee said despite the “cloud of uncertainty” caused by the economic turmoil beyond the local government level, she was proud of the budget that was passed on June 3. She specifically pointed to the affordable housing special revenue and pay raises for town staff as major steps toward helping the town address needs while staying true to character.
“I believe the budget brought forth by Town Manager [Patrice] Toney really spoke to council priorities and also community priorities,” Foushee told 97.9 The Hill. “Priorities are [meant to be] reflected in the town budget, so I feel like we’re right on point here.
“This was the budget that Carrboro needed this year,” she added. “There were some structural imbalances, there were some corrections that needed to be made… but it just fell at this critical time when people are feeling the pinch from so many other things, and that was the deepest regret from us in putting this recommended budget forward.”
The full, approved Town of Carrboro budget for FY2026 can be found on the town government’s website.
Hillsborough
Total budget: $33.8 million (3% decrease from FY25)
Approved property tax rate: 51.3 cents per $100 of valuation (9.4 cents less than FY25 rate)
Amount above revenue-neutral rate: 5.7 cents
Board Vote: Unanimous (4-0, one commissioner absent)
Notable details:
The final Hillsborough budget included the second consecutive increase in stormwater fees ($15 more, bringing it to a total of $105 per residence) and increases around its rate for water and sewer services (up 7.5%). The latter change is partially in response to a major reason why Hillsborough’s proposed budget was delayed compared to the other local governments’, as the town aims to cover some of the funding gap for replacing a pump station at its Elizabeth Brady Road wastewater treatment facility. President Donald Trump’s administration rescinded the town’s BRIC grant from FEMA in April, leaving the town government presently on the hook for a $6 million replacement. While Hillsborough staff explore other funding options, the town allocated $450,000 more to the capital improvement project than it had previously budgeted and added to the need for raising water and sewer rates.
Comments by the Mayor:
Mayor Mark Bell told 97.9 The Hill after the budget’s approval on June 9 that this cycle was the most challenging in his ten years of elected service. He cited the balancing act needed between the town’s revenue and expenditures amid a difficult economic outlook, projected flat revenues, and a jump in overall tax burdens by residents.
“It has been an extraordinarily difficult budget season,” Bell said, “and the need to carry on the work we’re doing regardless [is also difficult]. We invest in long-term infrastructure projects and planning for [those], so it’s really hard sometimes to hit the brakes mid-project…it might be a multi-year project. We struck a balance between continuing the projects that were underway, but postponing pre-payment for some of the other infrastructure-related [investments] that are long term and are very expensive.”
The full, approved Town of Hillsborough budget for FY2026 can be found in the Board of Commissioners’ materials from its June 9 meeting.
Featured photo via the Orange County government.
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