Fairfax City Manager Proposes FY27 Budget With Tax Rate Adjustments

FAIRFAX CITY, VA — Fairfax City Manager Dan Alexander presented the proposed Fiscal Year 2027 budget to the City Council Tuesday night, emphasizing long-term stability and responsible investment.

Alexander's proposal includes a 2.5 cent increase in the real estate tax rate, from $1.055 to $1.08 per $100 of assessed value. A half-percent increase in the meals tax, from 4 percent to 4.5 percent, is also proposed. Additionally, wastewater rates would increase by 6 percent, and stormwater utility rates by 5 percent. The budget also utilizes $5 million from the unassigned fund balance.

The proposed real estate tax rate adjustment, combined with natural assessment growth, would result in an average annual increase of $517 for residential properties, or about $43 per month. The budget includes a 3 percent general salary adjustment for city employees, step increases for public safety personnel, and a 1 percent cost of living adjustment for all city employees. These measures support retention and competitiveness.

FY 2027 Budget Plan Highlights

• Tax rate = $1.0550 ($0.0250 increase).
• Expenditures for all funds = $290,212,082.
• General Fund expenditures = $198,691,789 (9.9% increase over FY 2025 adopted budget).
• Fully fund the city school board’s tuition request of $71.4 million
• $200,000 for an efficiency audit.
• Rate increase of 6.0 percent for both the wastewater and stormwater utilities.
• The meals tax remains unchanged at 4.0 percent
• Unassigned general fund balance = maintained at 17.7 percent
• Recommended CIP expenditures to fully fund 126 projects = $98.1 million for FY 2026 and $614.9 million for FY 2026–30.

The proposal focuses on preserving the city's financial strength while honoring commitments to residents, schools, and employees, according to Alexander. This budget is a plan and policy tool, guiding resource allocation and service delivery.

The proposed budget for FY27 totals $207.5 million for the general fund, marking a 4.5 percent increase over the FY26 adopted budget. Alexander stated that no new full-time staffing positions are proposed, nor are there reductions in current programs or new initiatives.

Also See ...

• Rising Costs Of Willard Sherwood, Other Projects Addressed By City Council
• City Council Decides Fate Of Controversial George Snyder Trail Project
• Tie Votes On Willard-Sherwood Project Alarm Fairfax County Official

Key drivers for the FY27 budget include a $5 million increase for the school tuition contract, $3.3 million for planned debt issuance for school renovations and the Willard Sherwood Health and Community Center, and $1.3 million for workforce investment. Education represents the city's largest general fund obligation. The city maintains a AAA credit rating, which Alexander noted could save $8 million to $11 million in interest on upcoming school bond issuances.

The budget timeline includes work sessions and public hearings through March and April, with adoption scheduled for May 5.

FY 2027 Budget Plan Timeline

• Feb. 24 - Presentation: FY 2027 City Manager's proposed budget presentation
• March 3 - Work Session: FY budget work session; presentations by school board
• March 10 - Public Hearing: FY 2027 budget public hearing; consideration of real estate tax rate to be advertised (A 30-day advance notice is required before a public hearing on the real estate tax rate when assessments increase more than 1 percent.)
• March 24 - Public Hearing: FY 2027 public hearing
• April 7 - Work Session: FY 2027 budget discussion work session
• April 14 - Public Hearing: FY 2027 budget public hearing; introduction of C&I, wastewater, stormwater utility and Old Town Service District rates; introduction of FY 2027 budget appropriations; budget work session
• April 28 - Public Hearing: FY 2027 public hearing for real estate tax rate; C&I, wast wastewater, stormwater utility and Old Town Service District rates; FY 2026 quarterly financial review; budget discussion work session
• May 5 - Adoption: Special Council Meeting — public hearing on FY 2027 budget appropriation; budget adoption.

City residents can use Engage Fairfax to provide feedback on the FY 2026 budget. They can also send an email to the mayor or City Council, speak at a council meeting or submit a video for a public hearing. Learn how to use all these tools at the City Meetings page.