Durham’s FY25-26 Budget Proposal: Tax Rate Hike, Infrastructure Boost, and Community Safety Top Priorities

At Monday night’s Durham City Council meeting, City Manager Bo Ferguson introduced a proposed $772 million budget – his first on the job – for the upcoming fiscal year that aims to balance rising service demands, staff pay, and critical infrastructure needs. That’s while navigating the financial impact of recent property revaluations.

The proposal includes a recommended property tax rate of 43.71 cents per $100 of assessed value, marking a 5.48-cent increase over the revenue-neutral rate of 38.23 cents. While that’s a significant increase from the revenue-neutral threshold, it’s also a decrease from the current rate of 59.62 cents.

The budget, Ferguson said, is rooted in four clear priorities: community safety, employee compensation, core service delivery, and infrastructure investment.

“We’ve heard clearly from our residents,” Ferguson said. “You want continued investment in public safety and additional equitable infrastructure that supports our quality of life. This budget responds to that, even as we face rising costs, inflation, and pressure on revenue sources.”

What the Tax Rate Means for Homeowners

If adopted, the proposed tax rate would result in a city property tax bill of approximately $1,814 for a median-value home of $415,000, according to county data. Nearly 2 cents of the proposed rate increase is designated for debt service tied to the $200 million bond passed by voters in 2024.

Budget Breakdown and Key Investments

The proposed FY25-26 budget represents an 8% increase over the current year, reflecting expanded services and rising operational costs.

🛡️ Community Safety

• Adds 17 full-time positions for crisis response through the HEART team.
• Expands funding for the DEAR Program (expunction and license restoration) and Eviction Diversion Program.
• Continues implementation of Forever Home, Durham, a $160 million affordable housing initiative that will add 485 more affordable units in its final ARPA-funded phase.

👷 Employee Support

• Implements market-rate salary adjustments and pay-for-performance raises.
• Raises the Minimum Livable Wage for City employees from $19.58 to $21.90 per hour.
• Ferguson cited reduced turnover and vacancies since last year’s pay plan overhaul.

🚍 Service Delivery

• GoDurham buses remain fare-free through June 2026.
• $17 million allocated for bus service expansion.
• $500,000 earmarked for Vision Zero traffic safety programs.

🏗️ Infrastructure

• A $537.6 million Capital Improvement Plan funds over 70 projects:
  • $315.7 million for water and sewer upgrades, including the Jordan Lake Water Treatment Plant.
  • $25.7 million for stormwater improvements such as the South Ellerbe Restoration Project.
  • Modest increases in water and sewer rates to support system maintenance and expansion.

🏞️ Parks and Public Spaces

• $12 million (up $7 million) for lead soil remediation at five city parks: East Durham, East End, Lyon, Northgate, and Walltown.
• Adds 6 staff positions and nearly $400,000 for ongoing park upkeep.
• Major projects funded through the 2024 Connect Durham Bond are advancing:
  • $43 million Aquatic Center at Merrick-Moore Park (on the Council’s agenda Monday).
  • A $42 million greenway connector between Long Meadow and East End Parks coming later this summer.

🛣️ Streets, Sidewalks, and Safety

• Bond-funded upgrades include:
  • $25 million for repaving (up from $15 million).
  • $10 million for sidewalk repairs (up from $2 million).
  • Investments in bike routes, safer school zones, and pedestrian infrastructure.

Have Your Say

Public input is still welcome:

• Budget work sessions: May 28 and 29 at 9 a.m. (livestreamed).
• Public hearing: June 2 at 7 p.m.
• Final vote: June 16 at 7 p.m.

More information, including how to comment or watch online, is available on the Durham City Council webpage.

Check Out Highlights from See Gov

Other Business

City Council members on Monday unanimously approved the Brier Creek Multifamily Project, which is slated to bring 408 townhouses and apartments to the Durham and Wake county line area.

To gain approval, developers committed to a $50,000 donation to the Durham Dedicated Housing fund, committed to affordable housing availability for 30 years, and increased the contribution to Durham Public Schools from $10,000 to $16,500.

The city also is moving ahead with pre-construction planning and engineering for the new Durham Parks and Recreation Outdoor Aquatics Center, which will be built near Wheels Roller Skating Rink.

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