Once Again, BHI Implements Highest Municipal Tax Rate In Brunswick

By Johanna F. Still, posted Jul 18, 2023
Bald Head Island has implemented the highest tax rate in Brunswick County for the 2023-24 fiscal year. (Photo by Johanna F. Still)
Homeowners in the affluent Bald Head Island community are once again facing the steepest tax rate in Brunswick County. 

Bald Head’s new island-wide tax rate is $0.5779 per $100 value of taxable property. This tax rate is actually lower than the previous fiscal year's rate of $0.7213, but because of the latest county-wide revaluations, property owners on the island are likey facing a bigger tax bill. 

Beginning July 1, the village’s latest tax rate took effect – a nearly 22% hike from the revenue-neutral rate of $0.4745. Brunswick County underwent a revaluation this year, with values increasing by a median of 55%, a county spokesperson told the Business Journal in March. 

Municipalities are required by law to calculate the revenue-neutral rate, which equates to the rate that would bring in the exact same revenue as the year before while accounting for the increased property valuations. At a revenue-neutral rate, property owners would theoretically pay the same amount in ad valorem taxes. 

The average home value on the island is about $1.2 million, according to Zillow, which would generate an annual property tax bill of about $11,400, including village and county taxes. There are two additional tax districts on the island, Municipal Service Districts zones A and B covering beachfront, dune and East beach properties. Properties in these zones pay county, village-wide and zone-specific tax rates. These areas were created in 2009 to pay additional taxes for shoreline protection purposes. 

Brunswick County's new tax rate is $0.342, about 2% higher than the revenue-neutral rate. 

Bald Head Island has long been home to the highest municipal property tax rate in Brunswick County. Since at least 2013, the island has topped the list, according to historic tax information provided by the county. Shallotte has the second-highest municipal tax rate in the county this current fiscal year, at $0.2876 – a nearly 19% increase above its revenue-neutral calculation, according to the town budget. 

“In spite of our best effort we attempted to maintain a revenue neutral budget for FY 23-24, but the rising costs of inflation forced us into making hard decisions,” Shallotte’s budget message states. 

The city of Southport has the third-highest municipal tax rate in the county, but opted to adopt the revenue-neutral rate of $0.275. 

Several factors prompted the village of Bald Head Island to institute the steep hike. 

According to budget materials, salaries, wages and benefits will see the highest expense increase, up about $1.1 million. A recent pay and classification study, cost-of-living and merit increases, additional 401(k) matches, other benefits improvements and the creation of three new positions prompted this bump. 

Legal expenses from the costly ferry battle have also tied up funds for the small village government. The village has spent a total of $1.9 million on litigation involving the transportation system as of May, according to a village spokesperson. 

Private equity firm SharpVue Capital is attempting to purchase Bald Head Island Ltd.’s privately operated system. The village attempted to enforce a stipulated right-of-first-refusal to purchase the system itself, which prompted Ltd. to seek a court order rendering the 1999 document void, which is tying up the sale to SharpVue.

During a budget hearing in May, island resident Tippy Antalik said the ferry legal expenses could have gone toward wastewater or beach nourishment costs. 

Island resident Rex Cowdry, who was a member of the public Bald Head Island Transportation Authority that was poised to purchase the system before the village intervened, told the council at that meeting that the village had more control over its legal expenses than leaders were suggesting. 

“Please, when the chance arises, grasp a common-sense solution and end the litigation drama, even if you don’t get all the control you have been seeking,” he said, according to the minutes. “And we taxpayers have better ways to spend our hard-earned money [than] paying for four or five Village lawyers to appear at hearings.” 

Correction: This article has been corrected to accurately describe Tippy Antalik's affinity to the island.
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