WECT INVESTIGATES: As tax rate jumps, Surf City council spends thousands on out-of-town retreats

SURF CITY, N.C. (WECT) - For the first time in over a decade, Surf City residents are staring at a property tax hike.

In June, Surf City Town Council approved this year’s budget, which raises taxes from $0.41 to $0.53 per $100 of valuation – a 30% jump. That means residents are beginning to receive bills that are hundreds of dollars – or, in some cases – over a thousand dollars more than they paid in property taxes last year.

“We live here. We try to make a living here. We’re not going to be able to afford to stay here with those tax rates,” said David Batts, whose family has lived in the Surf City area since the 1700s.

Town leaders say they need increased revenue to keep up as the once-small beach town continues growing. More than half of the new revenue is going to police and fire service enhancements, town manager Kyle Breuer said. It will also pay for a pay study to help keep the town competitive with other employers, he added.

Surf City Mayor Teresa Batts said increasing the tax rate was the toughest decision council has made in her near-decade as a member.

“It was not an easy decision,” she said. “It was a very hard decision.”

In recent weeks, residents have begun speaking out online – and at town meetings – against the tax increase. Some, like David Batts, are worried it means they’ll be priced out of their homes.

Concerns about the budget led WECT to take a deeper dive into the budget, and how it’s created.

Town staff and council spend months making the budget; Breuer said they incorporate feedback from department heads and the public. Then, once a year, council gets together for a “budget retreat,” where they spend hours – sometimes days – discussing the budget.

The retreats are common, area officials said, and have benefits like bringing council members closer together, ironing out disagreements and creating a more relaxing environment for complex discussions.

Surf City, however, is unique in its retreats. In each of the last four years, records obtained by WECT show town council has traveled to Wilmington – nearly an hour away from the beachside town – for its retreats, spending thousands on hotel rooms, conference room reservations and meals.

“I’ll say it’s a time for us to step away,” Mayor Batts said. “Step away from our normal routine.”

Surf City leaders say traveling out of town for retreats is beneficial. They enhance relationships between council members and are productive “resets” from usual discussions in Surf City Town Hall, which opened just a few years ago. This past year, Breuer said the retreat developed six strategic initiatives – mainly focused on utilities, infrastructure projects and bolstering public communications – that will help Surf City for years to come.

Spokespersons from Carolina Beach, Wrightsville Beach, Southport and Oak Island – fellow Southeastern North Carolina coastal communities – said, in the last five years, they have never done an out-of-town, overnight budget retreat. Instead, their retreats are held in town, providing easy access for staff, elected officials and the public.

Mayor Batts said last year’s retreat wasn’t recorded, but was advertised, and the public was welcome to drive 45 minutes south and attend. No one, however, did.

“It may be a sacrifice,” she said. “We’re not trying to deter anyone from coming. We want you to be a part of it.”

Receipts from the 2022 and 2023 retreats show minimal spending – only about $1,000 combined. Council members didn’t stay overnight, but rented out space at the SpringHill Suites near Wrightsville Beach.

In February 2024, though, council members stayed overnight at the Embassy Suites in downtown Wilmington. That trip cost over $2,000.

Then, in January of this year, council members spent two nights at the Aloft Hotel, also in downtown Wilmington. Between hotels, meals and conference room reservation expenses, the town spent $5,549.

“I think they would see it as a service. A service from each one of their council people they voted in,” Mayor Batts said when asked if the spending was fair to residents being asked to pay hundreds more in taxes. “Anything that was brought to us, we took the time out of our lives, for our citizens.”

The town also brought in an advisor, Lydian Altman, from the UNC School of Government to assist with this year’s retreat. In addition to paying hundreds for Altman’s lodging, Surf City paid the school $7,609 for a “defining strategic priorities agreement.”

That made the cost of the retreat more than $13,000.

In an email statement, the School of Government said they provide “a variety of paid and unpaid services to counties and municipalities and the public officials who serve them, including real-time advising, longer-term consulting including strategic planning and economic/community development, workshops/convenings, courses, publications and quick-turnaround resources such as blog posts and office hours.”

Altman helped navigate budget discussions, smooth out debate and gain consensus among council members, Breuer said. He and Mayor Batts said the cost was worth every penny the town spent.

To residents, though, the receipts are another example of a bloated budget, with excessive spending levels – and taxes.

“They’re just saying, ‘well, people have the money, just take the money from them and we’ll go on our little retreat,’” Ethan Schultz, who moved to Surf City in 2022, said. “It’s very concerning.”

“At that price tag, no. Not when you’re asking me to take a 30% hit on my taxes,” David Batts said.

Schultz and David Batts said town council should have had more public discussion about the budget. Their concern now is how they’ll afford to stay in their homes, and the town they love, moving forward.

“We’re obviously blessed to live here,” Schultz said. “But if our taxes keep going up…we won’t be able to live here anymore. We’ll have to sell our house, we’ll have to move away from the community that we love and support.”

The town has scheduled a public meeting for Oct. 7 to address questions and concerns about the budget and tax rate, which is compounded by looming property reevaluations in Pender County, which likely mean heightened taxes in future years, too. A Representative from the county will also be on hand.