Beaufort City Council approved a $70.17 million budget Tuesday, June 9, keeping the city’s tax rate at 73.9 mills while revising project funding after officials said a tax increment financing district should have been dissolved nearly a decade ago.
The fiscal year 2027 budget includes about $24.4 million in capital projects. City Manager Scott Marshall said it balanced city services, employee support, public safety, and long-term infrastructure work without a tax increase.
“The FY27 consolidated budget totals $70.17 million, including $24.4 million in capital projects,” Marshall told council. “This budget reflects a deliberate balance between addressing today’s needs and preparing for tomorrow’s opportunities.”
Marshall said that after consulting bond counsel, staff learned the city’s TIF II district should have been dissolved about 10 years ago and could no longer be used as a budget revenue source.
“Following that meeting and through discussions with legal counsel about whether we could use our TIF II funds on projects that were outside the TIF district, we were advised that the TIF should have been dissolved nearly 10 years ago,” Marshall said. “This means we cannot use these funds.”
According to Marshall, the city notified Beaufort County and the Beaufort County School District that they could be entitled to the remaining TIF II funds. He said about $1.8 million could go to the school district and about $800,000 to the county. The city also asked both entities to let Beaufort retain the funds for future Waterfront Park work.
The budget continues planning and design for the Henry C. Chambers Waterfront Park relieving platform and advances the next phase of the Duke Street streetscape project. Marshall said the city assembled replacement funding for Duke Street from American Rescue Plan Act money, redevelopment reserves, utility participation, and other capital sources.
The spending plan funds two additional Beaufort Police Department patrol officers through a federal Community Oriented Policing Services grant. A third grant-funded position was delayed until fiscal year 2028. The budget also funds replacement police vehicles, updated weapons, a drug spectrometer, and firefighter breathing apparatus.
Employees will receive a 2% cost-of-living adjustment and up to an additional 2% merit increase. The city will absorb a 3% increase in health insurance costs. Funding for the Housing Repair Assistance Program will rise from $100,000 to $150,000.
The budget also creates a dedicated debt service fund. During public comment, residents questioned outside agency funding and called for more transparency on the city manager’s evaluation and compensation. The budget takes effect July 1.