Real Estate Tax Rate Unchanged In Alexandria 2023 Budget Proposal

ALEXANDRIA, VA — A budget with no change to the real estate tax rate was proposed by Alexandria City Manager James Parajon Tuesday.

Parajon, who took over for retiring City Manger Mark Jinks in January, presented the general fund budget and capital funding plan proposals to City Council Tuesday. The $829.9 million general fund proposal for fiscal year 2023 is a 7.7 percent increase over the current year's budget. The $2.73 billion Capital Improvement Plan is for fiscal years 2023 to 2032. Parajon also recommends uses for the city's second allocation of the American Rescue Plan Act funds ($29.8 million).

"The values and strategies in this proposed budget align with those that have been in place for several years," said Parajon in a statement. "It includes policies and actions that underscore careful financial management; strategic investments in current and future needs; and support for innovative ways to deliver essential services to maintain the health, safety and quality of life for all Alexandrians."

The real estate tax rate is proposed to remain the same at $1.11 per $100 of assessed value. The budget includes two alternative budget options with 1-cent and 2-cent increases to the rate to fund other initiatives.

Even without a change to the tax rate, property owners with a higher 2022 assessment value would see a higher tax bill. The city's overall tax base increased by 6.24 percent from 2021 to 2022. For residential properties, about 82 percent increased in value, 3 percent decreased and 15 percent were unchanged.

"Real estate assessments and other key revenue growth areas exceeded expectations and staff was able to propose a budget that included employee compensation increases and investments in key priority areas without a real estate tax rate increase or significant service reductions," Parajon wrote in an introduction to the budget.

The budget makes employee compensation a key priority after public safety personnel have raised concerns about pay competitiveness on a regional level. The budget proposal has merit increases for city staff, a 6 percent increase in sworn fire pay scales, a 5 percent increase in sworn police and sheriff pay scales, and a 4 percent increase in general schedule pay scales.

A few fee changes are proposed in the budget. The stormwater utility fee is proposed to increase from $280 to $294 for expanded storm sewer capacity projects and improvements to system maintenance. The stormwater fee had been doubled in two steps from $140 to $210 in June 2021 then $280 in November 2021.

Another proposed change is increasing the commercial refuse fee from $411 to $484.22 per commercial property. No changes are proposed for the personal property tax on vehicles of $5.33 per $100 of assessed value, trash removal fee of $484.22, restaurant meals tax rate of 5 percent, the 10 percent admission tax (50-cent cap), Business, Professional and Occupational License tax of $0.35 per $100 of gross receipts, cigarette tax of $1.26 per pack, and transient lodging tax of 6.5 percent plus $1.25 per night.

A key part of the general fund budget proposal is fully funding the Alexandria School Board's operating transfer request of $248.7 million. The capital plan includes funding for the Minnie Howard campus high school project, renovation and retrofitting of the 1705 N. Beauregard St. office building for a swing space, and renovation and expansion of two elementary schools.

The proposed capital plan continues to address flooding and stormwater capacity concerns with $288.4 million to expand and accelerate flood mitigation and stormwater infrastructure. This includes fiscal year 2023 funding to address flooding at the intersections of Commonwealth Avenue and East Glebe Road as well as Ashby Street and East Glebe Road. Other major components of the 10-year capital plan include $105 million for DASH Bus fleet replacement, $83.2 million for the Waterfront Plan and flood mitigation infrastructure, $66.2 million for the West End Transitway, $181.8 million in capital funding for Metro, and $73.2 million to outfit and purchase the Mark Center building to colocate the health department and Department of Community and Human Services.

Parajon will give a virtual budget presentation to the public on Thursday at 7 p.m. Nine City Council work sessions will follow in the spring along with a March 7 budget public hearing, tax rate and add/delete public hearings on April 23, and budget adoption on May 4.

To see full budget documents and the budget process, visit www.alexandriava.gov/Budget.

SEE ALSO: Staff Salary Increases Included In Alexandria School Budget