News

City holds line on property tax, orders pay study

By Bill Moss, Published: July 8, 2026

The city of Hendersonville is holding off on a property tax increase this year while signaling that the rate is likely go up a year from now.

The City Council on June 24 with little discussion adopted a $75 million budget that keeps the tax rate at 52 cents/$100 valuation. The council had called a two-week timeout on adopting the spending plan earlier last month, one day after Henderson County commissioners voted to raise the county rate by 10 percent to fund pay raises for law officers, debt service on the new $170 million judicial center and other expenses.

City Manager John Connet told the council that the city might need to react to the county’s 18% pay increase for sheriff’s deputies and analyze the impact of county’s 4-cent property tax increase on the city’s share of sales tax revenue. (The projected number turned out to be a $600,000 loss annually beginning in July 2027.)

Ultimately, Connet recommended holding off on a tax increase in favor of a broader study of city pay rates.

“We looked at other local governments as it relates to employment market and competitiveness,” he told the council. “The commissioners approved an 18% cost of living adjustment in the sheriff’s department. They took a very shotgun approach, we feel like.

“However, it has been our practice to take a much more focused approach. So we are proposing to do a pay-and-classification study in the coming year and we’ll evaluate our market competitiveness” across “all functional groups, all employees, to identify recruitment and retention opportunities and assess how our organizational alignment meets those objectives.”

In a news release, Connet characterized the no-new-taxes budget as the right path for now.

“We understand that our residents and businesses are already feeling the impact of rising costs across the board,” he said. “This budget holds the line. It is the right decision for our community right now.”
The FY27 budget maintains previously planned increases to water and sewer rates to fund critical infrastructure investments.

“Good financial planning means doing things once and doing them right,” Connet said. “We want to bring council and the community a complete picture with compensation data, revaluation data, and a long-range revenue plan.” 

The FY27 budget contains a 4% cost-of-living adjustment plus mid-year merit increases to staff, averaging 2.5% annually. The city says that the pay-and-classification study will be presented to the city council in early 2027.

“We know what is coming in FY28,” Connet said. “We are not ignoring it. We are planning for it deliberately and transparently so that when the time comes, we can act with confidence and clarity.”