Charlottesville’s operating budget, if the city manager’s vision is approved by City Council, will be $226.2 million next year, a 6.27% increase over that of the current fiscal year thanks to rising tax revenue including the main revenue driver: property taxes.
While the budget doesn’t call for an increase in the property tax rate, which is 96 cents per $100 of value, recently released assessments rose 11.94% residentially and 12.89% commercially. That has caused some concern, as has the fact that the proposed budget spends most of the increased revenue.
“People are going to have different opinions,” interim City Manager Michael C. Rogers said Tuesday.
Even before the release of this new budget for the 2024 fiscal year, the city found itself in December with an extra $37.7 million. That amount came from a city surplus at the end of the 2022 fiscal year plus pandemic relief funds from the American Rescue Plan.
City Council allocated that money on such things as shorter bus headways, safe routes to school, the Meadowcreek Trail, land for affordable housing, emergency shelter operations at Premier Circle, City Hall ambassadors, software updates and more.
Rogers pointed out that there is something of a rainy day fund: $3.4 million of that total was left “unprogrammed,” which means that City Council can direct the funds at its discretion.
“The use of these funds and this proposed budget continue to represent significant investment in the priorities that Council has set while also ensuring that key services continue to meet the expectations of the community,” Rogers wrote in his budget letter to the council.
In recent months, Charlottesville has experienced a surge in gun violence, and some of the people closest to that violence, such as the B.U.C.K. Squad anti-gun violence group have argued that Charlottesville must find ways to lessen poverty which can contribute to childhood trauma and even more violence. This budget appears to do that with sizable allocations for staffing on the city’s Human Rights Commission, emergency housing, affordable housing as well as homeless services and community health initiatives.On the revenue side, the increased real estate assessments are expected to bring in nearly $10 million more than in the current fiscal year. The meals tax, which adds 6.5% to every restaurant bill, is expected to produce an additional $1 million to about $17 million. The lodging tax, an 8% addition to hotel and other overnight stay bills, would grow by $400,000 to a total of $7.4 million.
The sales and use tax, the city manager said, continues to rebound and is projected to exceed the 2023 budget by 3.6% to produce $500,000 in additional revenue. And continued high valuation for motor vehicles should, the interim manager asserted, grow 4.17% for about $500,000 in additional revenue.
The proposed budget calls for providing city public schools with $4.2 million in additional money to fully fund the school board’s operating request of $67.1 million.
The city’s capital improvement fund would be $98.9 million, about four times larger than recent amounts, largely to fund a replacement of Buford Middle School. There is $81.7 million of that amount that would come from the sale of bonds.
Some other budget highlights include 6% cost-of-living increases for city employees and 3% cost-of-living increases for retirees. Public safety boosts include nearly $2 million in additional spending, largely for software, at the Emergency Communications Center. Additionally, a new department called the Office of Emergency Management has been created with about $499,000 budgeted. And there’s $514,074 in new funding to create six new firefighter positions in the Charlottesville Fire Department.
The budget was presented to City Council on Monday night. Councilors are slated to reconvene this Thursday at 6 p.m. at City Space for a budget work session. City Council will meet again the following Thursday, March 16, also at 6 p.m. in City Space, to discuss outside and agency requests.
The tax rate public hearing takes place in City Council’s chambers on March 20. That’s followed two days later by another public hearing, what’s termed a “community budget forum” in City Space. Then comes a March 30 session on the capital improvement program in City Space, a second public hearing on the tax rate on April 3 and another work session three days later.
The proposed budget is slated to go up for approval on April 11.