Alexandria 2021 Budget Adopted Without Real Estate Tax Hike

ALEXANDRIA, VA — Alexandria City Council adopted the fiscal year 2021 budget Wednesday, addressing budget shortfalls from the coronavirus crisis without a real estate tax increase. City Manager Mark Jinks had withdrawn his 2-cent tax hike proposal intended for capital projects in his revised budget.

"In the face of an unprecedented economic crisis, City Council’s adopted FY 2021 budget represents a responsible balance between meeting urgent community needs and deferring other expenses," said Mayor Justin Wilson in a statement.

The approved operating budget totals $753.3 million, a 1.6 decrease from the current fiscal year 2020 budget. The real estate tax rate remains at $1.13 per $100 of assessed value, and no other tax increases were approved. Tax bills could still change depending on the assessed value of properties. Overall, the city's taxable property value increased by 4.15 percent in 2020.

Jinks had originally proposed a $799.9 million operating budget in February. The revised budget projected a $35.8 million decrease in revenue for the rest of fiscal year 2020 and a $56.4 million decrease in fiscal year 2021. That accounted for anticipated declines in consumer-based revenues such as the sales tax, meals tax, transient occupancy tax and personal property tax.

The withdrawn real estate tax rate proposal would have funded city and school capital projects, meaning the adopted budget will delay the start of the Waterfront Park and flood mitigation plan as well as the Minnie Howard Campus project until fiscal year 2023. The new Douglas MacArthur Elementary School project will proceed as scheduled, with students moving into the old Patrick Henry School swing space in fall 2020.

Of the $3.9 million program enhancements in the original proposal, $2.1 million has been deferred. The budget also eliminates pay increases for city government employees and freezes hiring with exceptions. The city expects to allocate $1 million in potential federal CARES Act funding along with potential state funding to the Alexandria Health Department to boost epidemiological staffing.

The approved budget reduces the operating transfer to Alexandria City Public Schools by $7.4 million. The city estimated the cost would have covered proposed pay increases for ACPS staff, but the final decision on the school district budget lies with the Alexandria School Board.