The Increasing Difficulty in Financing Cities

It’s getting harder to fund city government in North Carolina. On the one hand, that might seem hard to believe. People continue to flock to many cities and towns across the state. More than half of the state’s population lives in a municipality. One recent projection from American City Business Journals sees the Raleigh and Charlotte metropolitan areas alone adding nearly 3 million people in the next 25 years. Those newcomers who choose to live in city limits will join existing city residents in paying city property taxes, and join all those who shop in North Carolina in paying sales taxes that cities receive a share of. But all of these current and future residents demand city services too. The citizens and the businesses they work for want clean water, and good roads, and responsive police and fire departments, and timely trash pickup, and reliable public transit, and parks and other amenities that provide the quality of life that helped attract them in the first place. And North Carolina cities are particularly limited in the options they have to fund all these services. Some of these limitations have come about in recent years because of changes in laws or interpretations