Real Estate Tax Rate Unchanged In Approved 2023 Alexandria Budget

ALEXANDRIA, VA — On Wednesday, Alexandria City Council voted to approve the fiscal year 2023 budget with no change to the real estate tax rate while providing car tax relief and increasing the stormwater utility fee.

Alexandria's real estate tax rate remains at $1.11 per $100 of assessed value. However, property owners could still see an increase on their tax bills if they assessment increased. On average, the residential tax bill will increase by 6.5 percent, or $445, from last year. Before the vote, Councilmember Alyia Gaskins noted 2.2 cents of the $1.11 real estate tax are dedicated to the transportation improvement fund, and 1 cent goes to affordable housing.

There are changes to the personal property tax on cars due to car value appreciation during the COVID-19 pandemic. The budget includes a 78.8 percent assessment tax ratio for tax year 2022, which means a vehicle's actual market value is discounted by 21.2 percent. The personal property tax rate remains unchanged at $5.33 per $100 of assessed value.

In addition, City Council shifted the state's Personal Property Tax Relief funds to lower-value cars. That means the threshold for receiving a 100 percent car tax subsidy will be increased from vehicles priced at $1,000 or less to vehicles at $5,000 or less. The city estimates the change will eliminate the local tax on over 30,000 cars.

City Council approved another increase to the stormwater utility fee with the budget approval. For the stormwater utility fee bill due Nov. 15, the fee per billing unit will increase to $294. The current fee, which includes the bill due June 15, is $280 per billing unit. Last year, City Council approved the doubling of the fee in two steps: from $140 per billing unit to $210 in June 2021 and to $280 in November 2021. The fee increases last year and this year were attributed to accelerating flood mitigation projects. The city has experienced several notable flash flooding events during heavy rain in recent years.

Other fee changes approved in the budget include increasing the residential refuse collection fee by $15.78, from $484.22 to $500.00, and the commercial refuse collection fee by $89, from $411 to $500. The increase will support the city's food waste composting drop-off program and a proposed curbside food waste composting pilot program.

The city's $839.2 million operating budget is an 8.9 percent increase over the current fiscal year's budget. By comparison, City Manager James Parajon's proposed budget had been $829.9 million, a 7.7 percent increase.

The budget funds 100 percent of the proposed $248.7 million Alexandria City Public Schools operating budget, which gets final approval by the School Board after the city's budget is approved. The budget also funds all of the Alexandria City Public Schools approved capital improvement program.

Among the $33.9 million in priority investments funded in the budget are: compensation increases for city employees, affordable housing, climate change, early childhood and other supports for young children, increased police patrol staffing, the police body camera program., and co-location of the Department of Community and Human Services and Alexandria Health Department and 4850 Mark Center Drive.

"As we continue to emerge from the pandemic, this budget finances our City's recovery," said Alexandria Mayor Justin Wilson in a news release. "It invests in our employees, our basic services, our infrastructure and our schools, while incorporating the lessons of the last two years."

Along with the operating budget, City Council approved a $2.73 billion Capital Improvement Program for fiscal years 2023 to 2032. This includes $497.8 million for ACPS, which will go to the Minnie Howard high school campus project, renovation of the 1705 N. Beauregard St. office building for a swing space, and renovation and expansion of two elementary schools.

Check back on the city's website for full approved budget documents when they become available.