Another year saw a multi-million dollar revenue shortfall in the city’s budget.
Alexandria Mayor Justin Wilson said in a newsletter that the city’s property taxes are increasing gradually. The city’s motor vehicle personal property tax revenue, which soared during the pandemic, is also returning to normal.
According to the newsletter:
Real estate tax revenues are currently projected to increase by 2.4%, which would be a return to the anemic growth that has characterized the past decade and a half. After the pandemic-induced anomaly of higher-than-expected vehicle prices, our staff now projects that vehicle personal property tax revenues will return to normal next year with a modest 1% increase.
But while this is mostly good news for local home and car owners, Wilson said the city faces a shortfall that will require spending cuts, tax increases or a combination of both.
During part of the discussion at the Potomac Yard arena, Wilson and other city leaders spoke about how large commercial developments will depend on the city’s resident tax base, as office and commercial markets still suffer post-pandemic. He said he hopes that this will help optimize the situation.
2024 is a city election year, so leaders may be wary of proposing tax increases. Wilson has announced that he will not run for re-election, but the two current City Council members running for mayor may become reluctant to support tax increases in the months ahead of the June 18 primary election. .
However, on the spending side of the books, new costs such as cash capital and debt repayments to support city and school capital investments, new investments to support student enrollment growth, and local education fees will You can see that costs are increasing across the comparison table. Impact of new collective bargaining agreements on local transit services and city employees.
Wilson said the current shortfall is about $19 million.
“Given that local budgets must be balanced, any shortfall must be met through spending cuts, tax increases, or a combination of both,” Wilson said.
Wilson said the currently adopted guidelines call for City Manager Jim Parajohn to return to the council with two budgets: one with a tax increase and one with a scenario that includes a tax increase.
The budget proposal is scheduled to be submitted on February 27th.
According to Mr. Wilson,
It will be a difficult environment in which to adopt a budget. Given that residents’ tax payments have already increased this year due to increases in the resident tax base, we believe we should renew our efforts to avoid tax increases while protecting the core services that residents rely on. Last year was the seventh consecutive year of a budget with no tax increases, and we hope to continue this pattern.