Two Cents: How Waynesville Is Closing a $700,000 Budget Gap

By Jon Tharp, Broker  ·  May 17, 2026

Waynesville is raising property taxes this budget season, but the increase is considerably smaller than what residents in the surrounding county are facing. The town board is considering a 2-cent hike, bringing the rate to 49.9 cents per $100 of assessed value. That generates about $306,000 in new revenue and covers less than half of the $721,000 gap the town needs to close.

The shortfall doesn't come from runaway spending. Waynesville's $20.5 million general fund is under pressure from the same cost realities affecting small towns across Western NC: infrastructure, utilities, and most significantly, people. Town Manager Rob Hites has been direct about where the money is going. "We are preventing our competing local governments from poaching our trained staff," he said during budget discussions. The budget includes a pay and classification study targeting salaries at 10 percent above the median for comparable governments, keeping experienced employees from leaving for better-paying positions in nearby counties and municipalities.

For perspective, the 2-cent increase looks restrained against what the rest of Haywood County is absorbing this cycle. The county itself has proposed a 7-cent increase, and Maggie Valley is looking at 5 cents. Waynesville's proposal is the smallest of the three, even as the town faces the same underlying pressures.

Part of what is squeezing budgets across the region is that real estate development has slowed. When new homes and commercial properties get built, they expand the tax base and generate more revenue without requiring a rate increase. When development stalls, governments are left trying to fund growing costs from a fixed pool of taxable property. That is exactly the position Waynesville is in right now, and it is not unique to this town.

The tax increase is not the only line in the budget affecting residents. Water and sewer fees will go up 10 percent starting July 1, and electric rates will rise 3.19 percent. The town is also planning to draw $415,000 from its fund balance to cover the remaining shortfall, supplemented by projected gains in sales tax revenue and investment income. The town is pulling from several sources to keep the rate increase as small as possible.

If you want to weigh in before the budget is finalized, the public hearing is set for 6 p.m. on Tuesday, May 26. These meetings are worth attending. Town boards in places this size pay attention when residents show up with questions.

On a $300,000 home, a 2-cent rate increase adds about $60 per year to the tax bill. That is not nothing, but it is far less than what homeowners in some neighboring communities are absorbing. The bigger picture is the long-term squeeze that small mountain towns are navigating as personnel costs rise, infrastructure ages, and development slows. Waynesville has managed to keep the number reasonable this year. Whether that holds next year depends heavily on whether growth picks back up.

These budget decisions shape what it actually costs to own property here, and that is worth understanding whether you have lived in Waynesville for decades or are considering it for the first time. If you have questions about what homeownership looks like in this part of the mountains, Jon Tharp is glad to help you think through the numbers.

 

Frequently Asked Questions

What is the new property tax rate in Waynesville, NC?

Waynesville is proposing to raise its property tax rate by 2 cents, bringing it to 49.9 cents per $100 of assessed property value. For a home assessed at $300,000, that increase adds roughly $60 per year to the tax bill. The change is part of the town's fiscal year 2026-2027 budget, which is still under review. A public hearing is scheduled for May 26 before the board takes a final vote.

Why is Waynesville raising property taxes in 2026?

The town faces a $721,000 gap between revenues and expenditures in its $20.5 million general fund. The primary driver is employee compensation. Town Manager Rob Hites has said the budget is designed to retain trained staff by targeting salaries at 10 percent above the median for comparable local governments, preventing other municipalities from recruiting Waynesville's workforce. The tax increase generates about $306,000 of the needed revenue, with the remainder coming from fund balance withdrawals, sales tax growth, and investment income.

How does Waynesville's tax increase compare to Haywood County and Maggie Valley?

Waynesville's proposed 2-cent increase is the smallest among the three governments raising rates this budget cycle in Haywood County. The county itself is proposing a 7-cent increase, and Maggie Valley is looking at a 5-cent hike. All three governments are responding to the same underlying pressures: rising personnel costs, aging infrastructure, and a slowdown in new real estate development that has limited tax base growth across the region.

Are there other fee increases in Waynesville's 2026 budget?

Yes. In addition to the property tax increase, Waynesville is proposing a 10 percent increase in water and sewer fees effective July 1, and a 3.19 percent increase in electric rates. These utility increases reflect ongoing infrastructure and operational costs separate from the general fund shortfall. Residents should expect the combined impact of the tax rate change and utility fee adjustments when planning household budgets for the coming fiscal year.

When is the public hearing on Waynesville's budget?

The public hearing on Waynesville's proposed budget is scheduled for 6 p.m. on Tuesday, May 26. This is the formal opportunity for residents and property owners to ask questions and comment before the board finalizes the budget. Town budget hearings in smaller municipalities tend to have meaningful attendance from community members, and boards typically respond to public input before taking a final vote.